Legislature(2017 - 2018)ADAMS ROOM 519
03/06/2018 01:00 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB285 || HB286 | |
| Amendments | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 286 | TELECONFERENCED | |
| += | HB 285 | TELECONFERENCED | |
| + | TELECONFERENCED |
HOUSE BILL NO. 285
"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."
HOUSE BILL NO. 286
"An Act making appropriations for the operating and
loan program expenses of state government and for
certain programs; capitalizing funds; amending
appropriations; making supplemental appropriations;
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."
1:06:43 PM
^AMENDMENTS
1:06:48 PM
Representative Tilton MOVED to ADOPT Amendment H DFG 21
(copy on file):
Statewide Support Services
Commissioner's Office
H DFG 21 - Intent language to establish research
priorities.
Offered by Representative Tilton
Wordage: It is the intent of the Legislature that the
Commissioner of the Department of Fish and Game work
with Boards of Fish and Game to establish research
priorities for future projects, and that those
priorities be transmitted to the legislature annually
to be considered during the budget process.
Explanation: Establishing a list of projects with a
priority will assist the legislature in allocating the
appropriate level of funding.
Representative Ortiz OBJECTED for discussion.
Representative Tilton read the amendment (see above). She
elaborated that the Board of Fisheries and the Board of
Game were created to allocate the state's resources between
their user groups. In both instances they met regularly to
determine priorities. Establishing a list of projects in
priority would help the legislature when looking at
funding.
Representative Ortiz asked if Representative Tilton
believed it was important for the Board of Fisheries to be
an independent entity from the Department of Fish and Game.
Representative Tilton believed that the Board of Fisheries
and Board of Game were created to help the legislature
understand where to allocate state resources. She argued
that having a priority list would help the legislature to
better understand where to allocate funds during the
budgeting process. The boards were representations of their
specific industries.
1:09:07 PM
Representative Ortiz stated that the Board of Fisheries was
charged with making allocative and regulatory decisions.
Biologists provided objective assessment data to inform the
decisions. He believed, the request for the commissioner's
office to work with and, in essence, influence the Board of
Fisheries was inappropriate. He suggested that if the Board
of Fisheries wanted to influence the assessments of the
Department of Fish and Game (DFG) they were budgetary
decisions that belonged with the department. He thought the
amendment blurred the line he thought was necessary between
the Board and DFG.
Representative Wilson admitted that she had never been to a
Board of Fisheries meeting. However, she had been to
numerous Board of Game meetings. She appreciated the
remarks by Representative Ortiz and thought the people
influencing the board were people from the department. She
suggested that if the legislature wanted the department to
be independent from the board, then perhaps they should not
be attending the meetings and providing all of the
information. She agreed that there was a large influence
occurring currently. She thought the intent language of the
amendment was saying that all three groups needed to sit
down together. The Board of Fisheries and the Board of Game
were who the legislature had inserted. She continued that
some of the biggest priorities of the state fell within the
purview of the Board of Fisheries and the Board of Game.
She thought that if the three entities were all going their
own way, things would not get prioritized. She did not
believe the amendment was about influence. However, she
wanted to see the current influence halted and for the
boards to become more independent. She thought the intent
of the amendment was to encourage all three entities to sit
down together at the table to figure out a path moving
forward and to prioritize funding. She did not think
influence had anything to do with the amendment.
Representative Tilton believed the amendment, brought
forward from another member from Big Lake, was a result of
the Board of Fisheries and the Board of Game meeting
regularly and having priorities. It was important for the
legislature to take notice of their priorities with some
sort of listing that they could use when making budget
decisions. Currently, the boards were not providing their
information to the legislature. The legislature was not
able to take the board's priorities into consideration.
Co-Chair Seaton had been to numerous Board of Fisheries and
Board of Game meetings. The board meetings mostly dealt
with proposed regulations. He reported that research
priorities were established primarily by the commissioner's
office. He opined that the amendment, as written, did not
indicate that the boards would be tasked with a new job. He
reported that the schedule of the Board of Fisheries was
very packed. He suggested that working with the
commissioner was something the board would do. He stated
that the amendment did not specify that the recommendations
would come from the Board of Fisheries but that the
commissioner would work with the board to determine future
projects. He thought the legislature would be enhanced by
receiving information about future projects in priority. He
suggested hearing from the department.
1:14:39 PM
Representative Ortiz could not speak to the relationship of
DFG and the Board of Game, as he had never attended a Board
of Game meeting. However, he had attended Board of
Fisheries meetings. The Department of Fish and Game was
present and provided comments on certain proposed projects
from the Board of Fisheries. He reported there being
cooperation between DFG and the Board of Fisheries. He
thought there were two things being discussed. He thought
the issue brought up by the member from Big Lake had more
to do with the Board of Game. In Representative Ortiz's
experience there had been communication and active
involvement between the Board of Fisheries and DFG. He did
not see where the amendment was needed.
MORGAN FOSS, LEGISLATIVE LIAISON, DEPARTMENT OF FISH AND
GAME, stated that the department might benefit from further
information about the intent of the amendment.
Representative Tilton clarified that the intent of the
amendment was not for DFG to tell the board what they
should be looking at. The amendment would require the
boards to work with the department on a priority list of
projects. The list could be provided to legislators so that
the legislature could better prioritize when budgeting.
Co-Chair Seaton objected to the amendment. He did not think
the Board of Fisheries needed to be tasked with coming
forward with a prioritization of projects. The Board of
Fisheries had specific tasks including taking public
comments, compiling a book of proposals for regulations,
and dealing with the regulations. He did not want to throw
another large task at the Board of Fisheries. The board was
already meeting for up to two weeks at a time.
1:18:24 PM
Representative Wilson countered that they were the
legislature's boards. She reported that the boards used to
have joint meetings. She thought the amendment might not be
necessary if they were to meet jointly more frequently. She
thought they already had priorities. She did not believe it
would cost anything or add to the agenda.
Representative Ortiz MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson, Grenn
OPPOSED: Gara, Guttenberg, Kawasaki, Ortiz, Seaton, Foster
The MOTION to adopt Amendment H DFG 21 FAILED (5/6).
1:20:20 PM
Representative Wilson requested to consider H DFG 22, H DFG
23, H DFG 24 simultaneously.
Representative Wilson MOVED to ADOPT Amendments H DFG 22, H
DFG 23, H DFG 24 (copy on file):
H DFG 22:
Statewide Support Services
Administrative Services
H DFG 22 - 3003: Information Technology
Offered by Representative Wilson
FY17 Actuals were $683.5 and the FY19 Governor's
budget request is $986.1. A decrement of $100.0 will
result in a FY 19 budget request of $886.1 for
Information Technology, $202.6 over FY 17 actual
expenditures.
H DFG 23:
Statewide Support Services
Administrative Services
H DFG 23 - 3001: Financial Services
Offered by Representative Wilson
FY17 Actuals were $234.6 and the FY19 Governor's
budget request is $346.8. A decrement of $50.0 will
result in a FY 19 budget request of $296.8 for
Financial Services, $62.2 over FY 17 actual
expenditures.
H DFG 24:
Statewide Support Services
Administrative Services
H DFG 24 - 3011: Other Services
Offered by Representative Wilson
FY17 Actuals were $580.3 and the FY19 Governor's
request is $682.1. A decrement of $50.0 will result in
a FY 19 budget request of $632.1 for Other Services,
which is $51.8 over FY 17 actual expenditures
Representative Ortiz OBJECTED for discussion.
Representative Wilson read the amendments (see above).
Representative Ortiz asked if Representative Wilson had
spoken with the department about the impact of the
amendments. Representative Wilson replied that she had not
contacted the department, nor did she hear from the
department about a negative or positive opinion about the
amendments.
Representative Ortiz asked if she had looked at the
particular funding sources for the proposed expenditures.
Representative Wilson replied affirmatively. She started
with personal services, making sure that she backed out all
general funds and federal dollars. Personal services were
not affected. She indicated it could be moved up and down
on the scale and was available in the specified area.
Representative Ortiz answered that funding sources
mattered. The net impact of all three amendments removed at
total of $200,000 from the Division of Administrative
Services; it was below actual expenditures at $126,700. It
was 6 percent below the FY 17 actual expenditures. In FY 17
all but $46,700 UGF was expended. The unexpended fund was
$1.4 million of federal receipts and $536,000 of other
funds. He expressed concerns about impacting services by
removing UGF because of there being $1.2 million in
uncollectable receipts. He thought other funding sources
were being mixed in with UGF funding sources. He believed
the net impact of the amendments would result in a
significant reduction of services.
1:25:01 PM
Representative Pruitt asked why the department would
continue to ask for the federal funding annually when it
knew it would not receive the full amount. The state was
having to backfill with UGF.
Representative Wilson provided wrap up on the amendments.
She found it interesting, looking at FY 17 actuals, that
the state only received $556,300 of federal dollars. In
FY 18 the department anticipated $1.7 million and in FY 19
it expected to have $1.7 million. She wondered where the
department got its figures when it only received $556,000
in FY 17. The department had $2.1 million in general funds
(the amendments were under administrative services).
However, the department budgeted the same amount of $1.9916
million for FY 18 and in FY 19. She continued that general
fund programing of the DGF that was discussed earlier was
$143,000 in FY 17. She highlighted that the amount was
close to the budget amount of $146,000 in FY 18 and FY 19.
The department also received other funding including CIP
receipts and STAT. They spent less in personal services
dropping from $7.6 million to $5.5 million. Services grew
from actuals of $3.1 million to a $5.6 million margin, even
though under the FY 18 management plan the department only
had $3.9 million. They went up another $1.5 million in
services from FY 18 to FY 19. She indicated that it
reflected an increase in services of $1.7 million.
Vice-Chair Gara stated that the numbers were not accurate.
Representative Wilson was including the federal numbers.
Representative Wilson stated that she included the federal
numbers. The department had the federal receipts as well.
She was very specific about the funding and its
composition.
Representative Ortiz MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Thompson, Tilton, Wilson, Pruitt
OPPOSED: Gara, Grenn, Guttenberg, Kawasaki, Ortiz, Foster,
Seaton
The MOTION to adopt Amendments H DFG 22, H DFG 23, and H
DFG 24 FAILED (4/7).
1:28:32 PM
Representative Wilson MOVED to ADOPT Amendment H DFG 25
(copy on file):
Statewide Support Services
Boards of Fisheries and Game
H DFG 25 - 3011: Other Services
Offered by Representative Wilson
FY17 Actuals were $12.3 and the FY19 Governor's budget
request is $153.2. A decrement of $50.0 will result in
a FY 19 budget request of $103.2 in Other Services
which is $90.9 over FY 17 actual expenditures.
Vice-Chair Gara OBJECTED for discussion.
Representative Wilson read the amendment (see above).
Vice-Chair Gara spoke about what the state could afford to
provide. He discussed significant cuts over recent years.
He wanted to be clear about whether the committee was
talking about state funds or federal funds being leveraged.
Representative Ortiz read from a prepared statement in
opposition to the amendment. Amendment 25 removed $50,000
from the Board of Fisheries and the Board of Game. He
reported that UGF was $7.1 million or 6 percent above the
FY 17 actual expenditures. In FY 17, all but $2.6 million
UGF was expended. The unexpended funding was primarily
other funding including CIP, SDPR, and IA receipts.
Increases in UGF were due to the increase in health
insurance premiums. Removing UGF would be uncollectable.
Other funds would impact services. In other words, the
reason for the request in funding for the line item was
because of an increase in health insurance premiums. He
suggested that if the legislature were to cut the funds,
the department would still have to pay the increase in
health insurance premiums but would be forced to reduce
services in other areas to compensate for the increased
health care costs.
Representative Pruitt needed to know why healthcare was
projected to increase 12.5 times what the total expenditure
was in other services. He was aware that health care costs
were skyrocketing, but he did not know why the expense was
budgeted for 12.5 times what it cost in FY 17.
Representative Ortiz wondered if someone from the
department was available.
1:32:36 PM
CAROL PETRABORG, DIRECTOR, DIVISION OF ADMINISTRATIVE
SERVICES, FISH AND GAME (via teleconference), relayed that
in FY 17 the department consolidated Administrative
Services within all of the small divisions. It reflected in
all of the small divisions - the reductions were taken out
of personal services and the services lines were increased
to pay for administrative support.
Co-Chair Seaton surmised it was not IA receipts but each
division paying for their portion of administrative
support. Ms. Petraborg responded affirmatively. She
expounded that prior to FY 17, the amount would have come
out of each division's personal services. Each division
paid through their services line - IA receipts to
administrative services.
Representative Wilson provided wrap up.
Vice-Chair Gara MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Tilton, Wilson, Pruitt, Thompson
OPPOSED: Gara, Grenn, Guttenberg, Kawasaki, Ortiz, Seaton,
Foster
The MOTION to adopt Amendment H DFG 25 FAILED (4/7).
1:35:29 PM
Representative Wilson MOVED to ADOPT Amendment H DFG 26
(copy on file):
Statewide Support Services
Habitat
H DFG 26 - 4000 Business
Offered by Representative Wilson
FY17 Actuals were $39.9 and the FY19 Governor's budget
request is $106.2. A decrement of $50.0 will result in
a FY 19 budget request of $56.2 in Business
Commodities, $16.3 over FY 17 actual expenditures.
Representative Ortiz OBJECTED.
Representative Wilson read the amendment (see above).
Representative Ortiz indicated it was the same issue about
increases for health insurance that caused the increase
request.
Representative Wilson provided wrap up. She indicated that
the amendment address commodities rather than services. She
did not think the state was purchasing health in insurance
in commodities. Federal receipts were $109,200 and general
receipts equaled $3.577 million. The reduction was $50,000
in commodities. Individuals would still be able to pay for
their health insurance.
Representative Ortiz MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Wilson, Grenn, Pruitt, Thompson, Tilton
OPPOSED: Gara, Guttenberg, Kawasaki, Ortiz, Foster, Seaton
The MOTION to adopt Amendment H DFG 26 FAILED (5/6).
1:37:32 PM
Representative Wilson MOVED to ADOPT Amendment H DFG 27
(copy on file):
Statewide Support Services
State Subsistence Research
H DFG 27 - 3011: Other Services
Offered by Representative Wilson
FY17 Actuals were $288.1 and the FY19 Governor's
budget request is $464.2. A decrement of $100.0 will
result in a FY 19 budget request of $364.2 for Other
Services, $76.1 over FY 17 actual expenditures.
Representative Ortiz OBJECTED.
Representative Wilson presented the amendment (see above).
Representative Ortiz offered that the amendment removed
$100,000 from the services line for state subsistence
research. He noted that UGF in state subsistence research
was $18,000 or .7 above the FY 17 actual expenditures. The
increase included $21,400 of UGF increases for health
insurance in FY 18 and FY 19. In FY 17 all but $1.4 UGF was
expended removing $50,000 UGF because there was an excess
authorization in other funds, primarily federal and
interagency receipts would impact services.
Representative Ortiz MAINTAINED his OBJECTION.
Representative Wilson provided wrap up on the amendment.
She thought she heard that $21,000 was needed for health
insurance. She left $76,100 in the account. She added that
she left $600,000 in personal services, even though there
was a decrease in the number of people. She also left
$10,000 in travel, $100,000 in services, and $140,000 in
commodities. She indicated she was referring to the period
between FY 17 and FY 19. There was $2.5 million in general
funds and $1.3 million in federal receipts.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson
OPPOSED: Kawasaki, Ortiz, Gara, Grenn, Guttenberg, Seaton,
Foster
The MOTION to adopt Amendment H DFG 27 FAILED (4/7).
1:40:20 PM
Representative Wilson MOVED to ADOPT Amendment H GOV 1
(copy on file):
Executive Operations
Executive Office
H GOV 1 - Personal Services Reduction
Offered by Representative Wilson
The FY 18 Personal Services vacancy factor was 4.61%
and totaled $433.8 resulting in post-vacancy Personal
Services line item authorized budget of $8,980.6. The
FY 19 Governor's budget request has a vacancy factor
of 0.74% and totals $68.1 with a FY 19 Personal
Services line item request of $9,130.6. This amendment
increases the FY 19 vacancy factor request from 0.74%
to 2.37% which results in a decrement of $150.0 in
this allocation. A vacancy factor of 2.37% is less
than half of the FY 18 vacancy factor and will reduce
the Governor's FY 19 Personal Services line item
request from $9,130.6 to $8,980.6. This amount matches
the FY 18 authorized budget of $8,980.6
Co-Chair Seaton OBJECTED.
Representative Wilson presented the amendment (see above).
Co-Chair Seaton spoke to his objection. He conveyed that
while the executive office personal services vacancy factor
appeared to be lowered than the guidelines set by the
Office of Management and Budget (OMB), there were several
non-permanent employees not included in the budget who
would still be on the board in FY 19. They included a
special agent, a constituent relations staff, a procurement
agent, a special assistant for cultural affairs, and a
special project support person. Once the costs of those
positions were recognized, the executive office vacancy
factor was $432,082. The vacancy factor was 4.52 percent
within OMB guidelines. He opposed the amendment.
Representative Thompson asked for clarification about the
three or four positions. He was unclear whether they were
in the budget. Co-Chair Seaton answered that the positions
were for non-permanent employees.
SHAWN HENDERSON, ADMINISTRATIVE SERVICES, OFFICE OF THE
GOVERNOR, answered that the vacant positions were non-
permanent positions hired under an employment service
agreement. There were several positions including a special
agent, a procurement agent, a special assistant for
cultural affairs, a projects, policy and program
specialist. Adding the non-permanent positions into the
budget increased the vacancy factor to 4.52 which was
within the OMB guidelines.
Representative Pruitt asked if the positions Mr. Henderson
had highlighted were currently filled within the Office of
the Governor. Mr. Henderson replied in the affirmative.
Representative Pruitt asked if the additional $150,000
requested was to cover increases in salary. He asked what
the amount was for.
GUY BELL, FORMER DIRECTOR, ADMINISTRATIVE SERVICES, OFFICE
OF THE GOVERNOR, answered that $150,000 was included in the
FY 19 budget as a line item transfer from contractual
services. The Office of Management and Budget brought money
into personal services from contractual services because
the department brought 3 positions back that had been
transferred to the Department of Administration for shared
services and IT and used the additional authority to cover
the cost of those positions.
1:46:41 PM
Representative Wilson asked about vacancy rates. She
wondered about a higher vacancy rate and whether the
department would have to leave more months open without
hiring the positions. Mr. Bell replied in the affirmative.
He elaborated that the vacancy factor was the difference
between 100 percent of the cost of positions for the full
year versus the amount of funding the department received.
The difference needed to be covered by vacancies through
the course of a year.
Representative Wilson asked if a decrease in the vacancy
rate would allow the department to have more money for
personal services for the contracts. Mr. Bell replied in
the affirmative. The department would be able to maintain
the same vacancy factor and still retain certain employees
under employment contracts.
Representative Wilson asked why they did not ask for the
increase of $150,000 and leave the vacancy rate the same.
She thought it would have been more transparent to show
that there was an increase to personal services in the
Office of the Governor's budget. Mr. Bell answered that the
positions brought back and funded with the transfer from
contractual services were permanent positions currently in
the budget. However, they were not in the authorized FY 18
budget.
Representative Wilson asked if Mr. Bell was referring to
the three positions that had been brought back from shared
services to the Office of the Governor. She asked if the
funding went with the three positions or whether the
funding was left in shared services.
Mr. Bell answered that funding had never actually
transferred over to shared services. The money was moved to
contractual services within the executive office to pay by
a reimbursable services agreement for the positions. It was
a line item transfer which could be found in an IA receipt
authority in shared services.
Representative Wilson thought Mr. Bell was saying it had
changed because there were more people being paid in the
governor's office than in FY 18. Mr. Bell responded
positively.
Vice-Chair Gara respected what the governor's office had
tried to do, as the governor had tried to lead by example
when he was elected. He knew there had to be budget cuts.
He tried to spare the budget cuts that hurt people
personally by cutting his own budget. He reported there had
been a 25 percent cut in the governor's office, over $8
million since 2015. He did not have a problem with the
governor trying to hire back a couple of part-time people
to make things work. The office had been cut by over $8
million. He believed the governor's spending had been
responsible.
Representative Wilson provided wrap up on the amendment.
She indicated her amendment was not a shot at the governor.
There were more people in the governor's office in the
budget than in FY 18. There was $150,000 in the budget to
compensate additional employees. She was concerned with
transparency. She argued that it was an increase to the
budget no matter how people viewed it. Her amendment would
keep funding at the FY 18 level.
Co-Chair Seaton MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson, Grenn
OPPOSED: Guttenberg, Kawasaki, Ortiz, Gara, Foster, Seaton
The MOTION to adopt Amendment H GOV 1 FAILED (5/6).
1:52:39 PM
Representative Wilson MOVED to ADOPT Amendment H GOV 2
(copy on file):
Contingency Fund
H GOV 2 - 3001: Financial Services
Offered by Representative Wilson
FY17 Actuals were $0 and the FY19 Governor's request
is $550.0. A decrement of $100.0 will result in a FY
19 budget request of $400.0 for what is described as
"agency support as needed to meet high priority needs
in the contingency fund"
Co-Chair Seaton OBJECTED.
Representative Wilson read the amendment (see above). She
remarked that the contingency fund was worth more than her
house. She thought at some point a contingency fund would
change into a capital request or another type of request.
She conveyed that the fund was not used in the prior year.
Her amendment was a slight decrease in the fund amount.
Mr. Henderson replied that the contingency fund in the
Office of the Governor had existed for about 30 years. He
detailed that it had a budget of $800,000 in FY 14 and had
been reduced to $550,000 reflecting a reduction of
$250,000. The contingency funds allowed the governor to
have flexibility to access funds when other sources were
not available. Historically, the funds had been used for
various sources including transition costs when the
governor took office in 2015. The funds had also been used
for redistricting costs and gasline efforts. In general,
the fund was available for shortfalls.
1:55:44 PM
Representative Wilson stated the decrement was $150,000.
She surmised it was a slush fund. Mr. Henderson disagreed
with Representative Wilson's terminology.
Representative Wilson thought Mr. Henderson was saying the
fund could be used for almost anything. She asked how much
the transitional costs were in 2015. Mr. Henderson answered
that the cost was $150,000. Representative Wilson asked how
much the cost had been for redistricting. Mr. Henderson
replied that it was approximately $300,000. Representative
Wilson asked about the gasline cost. Mr. Henderson replied
that it was $150,000.
Representative Pruitt stated that in FY 17 none of the
funds had been used. He wondered if there was an
expectation, outside of transition costs, of there being
any redistricting costs. He asked if the governor had any
intent on using the funds for the gasline. He asked if
there were other things on the horizon for which the funds
could be used. Mr. Henderson replied that he did not know
about how the funding would be used. He would be advised by
the governor or his senior staff.
Representative Pruitt thought the point Representative
Wilson was trying to make was that the money could be used
by the governor in any way he chose. The hesitation on the
legislature's part in maintaining a $550,00 fund had to do
with the uncertainty of how the money would be used. He
thought the amount left in the account with the amendment
was a reasonable figure. He would be supporting the
amendment.
Vice-Chair Gara remarked that when Governor Parnell was in
office the amount in the account was $800,000. At the time,
nobody tried to remove the amount. He thought there had to
be a separation of powers and contended that the governor
had been responsible in not using the fund in a major way.
He thought that the current governor should be treated the
same as prior governors. He did not believe there was any
evidence that the funds had been wasted. He did not
understand why the current governor was being treated
differently.
2:00:24 PM
AT EASE
2:00:54 PM
RECONVENED
Co-Chair Seaton noted that the fund was a contingency fund
that lapsed annually. Historically the governor's and the
legislature's budgets had been left alone. The amendment
would take away the flexibility of funds available for
whatever emergency might arise. He opposed the amendment.
Representative Guttenberg spoke about the separation of
powers. He did not believe the legislature should
micromanage things at this level. He posed the question
about whether legislators' office accounts were slush
funds. He indicated that those funds paid for day-to-day
things. He thought it was inappropriate to call office
accounts slush funds just as it was inappropriate to call
the contingency fund a slush fund.
Representative Grenn appreciated the conversation. He
thought it was a great example of helping to form opinions
and gain context. He referenced Representative Guttenberg's
point regarding office accounts. In the prior year the
House reduced its office accounts by a substantial
percentage. I appreciated the current amendment in the same
vein.
Representative Tilton pointed to the difference between the
office account and the governor's contingency fund. The
receipts for the office accounts had to go through finance
and fell under IRS guidelines. She also highlighted that
office accounts and the governor's contingency account were
similar in that the accounts were not always used to their
full extent.
Representative Wilson clarified that the account was being
reduced by $150,00 from $500,000 leaving $400,000 in the
account. She opined that the legislature should have cut
Governor Parnell's $800,000 fund. She responded to other
concerns such as a separation of powers. She stressed that
the funds contributed to the state's budget gap. She
emphasized that the amendment was not against the governor.
She spoke to other costs. She was concerned about using
$150,000 from the fund for the gasline. The amendment would
leave $100,000 over the highest amount in the past three
years.
Co-Chair Seaton MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Ortiz, Pruitt, Thompson, Tilton, Wilson, Grenn,
Kawasaki
OPPOSED: Gara, Guttenberg, Foster, Seaton
The MOTION PASSED (7/4). There being NO further OBJECTION,
Amendment H GOV 2 was ADOPTED.
2:07:41 PM
Co-Chair Seaton MOVED to ADOPT Amendment H HSS 11 (copy on
file):
Behavioral Health
Behavioral Health Treatment and Recovery Grants
H HSS 11
Replace Unsustainable Alcohol and Other Drug Treatment
and Prevention Funds with Recidivism Reduction Funds
Offered by Representative Seaton
Currently, and in the past few fiscal years,
appropriations from the Alcohol and Other Drug
Treatment and Prevention Fund have exceeded revenue to
the fund. The excess appropriations have been covered
by a carry forward balance. At current appropriation
levels, the carry forward balance will be exhausted in
FY20.
Total appropriations of $24.6 million included in the
FY19 Governor's request for Alcohol Funding are $3.9
million more than the $20.7 million of anticipated
FY19 revenues. Because appropriations from the Alcohol
Fund have exceeded current year revenue since FY14,
the carry-forward balance in the Alcohol Fund has
declined as follows:
FY15: $18.4 million carried forward into FY15
FY19: $6.9 million anticipated carry-forward into FY19
FY20: $2.9 million carried forward but there will be
an estimated shortfall of $1 million in available
funding. Another fund source will be needed, or
services will be reduced.
The Department of Revenue projects that in FY19 there
will be $9 million of Recidivism Reduction Funds
available for appropriation. This amendment would
increase the use of Recidivism Reductions funds from
$6 million to $7.5 million. The budget for this
allocation already includes $1,625.0 of the Recidivism
Fund. With this amendment the total will be $3,125.0.
Representative Wilson OBJECTED for discussion.
Co-Chair Seaton read the amendment (see above).
2:09:54 PM
Representative Wilson asked Co-Chair Seaton to help her
understand where the money for alcohol and other drug
treatments was coming from. She wondered whether not having
enough money was a result of less alcohol being consumed in
Alaska. Co-Chair Seaton responded that that there was less
carry forward because more money was being spent.
Vice-Chair Gara asked to be a co-sponsor of the amendment.
The issue came from his subcommittee which was brought to
the subcommittee's attention by the Legislative Finance
Division. He noted that the state was taking less in
alcohol tax and providing treatment through the fund
presently. The state would be spending more than it was
taking in FY 20. The amendment specified that the other
treatment related fund, the fund from which the marijuana
tax proceeds could be used, was the recidivism reduction
fund. He conveyed that both were treatment funds. The
current amendment would extend the ability for the alcohol
tax fund to cover the state's treatment services for 1
year. The amount that could be used was equal to half of
the excess proceeds from the marijuana tax. The funds could
be used for the Recidivism Reduction Fund. The estimated
excess was projected to be about $3 million. It would
provide the legislature and the administration an
additional year to come up with a plan. He suggested that
there was no fiscal impact with the amendment.
Representative Wilson wondered why the state was
overspending. She asked who received the grants. She asked
if certain criteria were used to determine if those going
through treatment were completing it. She expressed
concerned about using money that was put away for jails and
to help people get back on their feet and keep them from
reoffending. She wanted to better understand who was
receiving the grants.
Vice-Chair Gara responded that the alcohol tax fund was
used for both alcoholism and treatment. He opined that the
state did not provide enough alcoholism and drug treatment
in Alaska. The alcohol tax did not cover all of the costs.
Over the years, the legislature had been appropriating a
little bit more out of the alcohol tax and other drug
treatment funds than was being received for alcohol taxes.
2:14:24 PM
Representative Wilson asked if the programs that received
funding were working. She recalled that previously the
legislature had not seen any statistics on people
completing treatment. She thought that perhaps the state
was spending money on programs that were not successful
rather than on other things.
SHAWNDA O'BRIEN, ASSISTANT COMMISSIONER, DEPARTMENT OF
HEALTH AND SOCIAL SERVICES, thought Representative Wilson
might be confusing the fund source with the Alcohol Safety
Action Program, which was a different program. The funds
went towards supporting substance use prevention and
treatment efforts. They were different grant program funds
than the funds related to the Alcohol Safety Action
Program.
Representative Wilson asked if any of the grants went to
the treatment of alcohol and substance abuse or were the
grants used to prevent people from drinking and taking
drugs. Ms. O'Brien replied that the grants went toward the
Substance Misuse Treatment and Prevention Program.
Representative Wilson asked for statistics relating to the
grant program successes of people no longer taking drugs or
drinking. She wondered what the percentage rate was for
every 100 participants in the program that no longer drank
or took drugs. Ms. O'Brien could follow up with the
information.
Representative Wilson asked if there was a connection
between the people being helped in the program with people
just getting out of jail. Ms. O'Brien answered that the
recidivism reduction funds were not comingled with the
funds being discussed. They were set aside for a separate
program and served a different purpose. The amendment was
requesting was to be able to co-mingle the fund sources in
order to extend the existing services the state was
providing beyond the what the funding currently allowed.
Representative Wilson wondered, with recidivism being as
high as it was, whether individuals that could be using the
recidivism funds were participating in any of the grant
programs currently available.
Ms. O'Brien responded that the state's population was being
served by the different types of funding in different areas
of the budget. She reported that it was possible that the
populations being served by the Substance Misuse, Treatment
and Prevention Program and the Recidivism Reduction Program
were similar or would potentially cross over. Folks coming
out of prison would likely be participating in more than
one of the state's program areas. The Recidivism Reduction
Funds were currently being administered by the department
under SB 91 [Legislation passed in 2016 - Short Title:
Omnibus Crim Law and Procedure; Corrections] efforts. They
were different initiatives than what this particular fund
source had been used for. She guessed the populations being
served in both areas were very similar or that there would
be some crossover.
2:19:15 PM
Representative Wilson stressed the state's major recidivism
problem. She found it hard to believe there would be any
funds left over when 2 or 3 offenders got out of jail and
reoffended. She was concerned about not knowing who the
funds were going to and whether the programs were
successful. Her larger concern had to do with utilizing the
funds for anything other than what they were intended for
in SB 91; treatment. She was aware that the Department of
Corrections (DOC) was putting together more programs for
recidivism.
Vice-Chair Gara commented that it was up to legislators and
the department to figure out how to reduce recidivism. The
bulk of the recidivism reduction funds were going through
DOC and to people who had been released. The requested
budget of the $9 million expected from the fund was $6
million. He concluded that no money the amendment touched
would impact what was proposed by the legislature or the
governor's office for recidivism reduction. He would not
support the amendment if money was being taken away from
recidivism reduction efforts. Currently, there was a
projected $3 million excess for the coming year.
Representative Pruitt wanted to make sure the legislature
did not do the same thing to the recidivism fund that had
been done to the alcohol fund. He believed the amendment
was temporary and resulted in a fund change. He asked how
to ensure that as the need for recidivism funds increased,
less money would go into the alcohol fund. He was concerned
about the long-term sustainability of both funds and the
potential difficulties that might arise in the budget
process going forward.
2:22:44 PM
Co-Chair Seaton asked to hear from the Legislative Finance
Division.
LACEY SANDERS, ANALYST, LEGISLATIVE FINANCE DIVISION,
addressed Representative Pruitt's comments about ensuring
the legislature did not overspend the recidivism reduction
fund. She reported that in FY 19 there was projected to be
$9 million in the recidivism reduction fund. The amendment
increased the spending which in FY 18 was $6 million to
$1.75 million. The proposed number was utilized so that if
revenue did not come in as projected, there would not be a
shortfall in the ability to issue grants.
Representative Pruitt asked Ms. Sanders to repeat her
answer. Ms. Lacey responded that in FY 19 there was
projected to be $9 million of revenue from recidivism
reduction funds. The current budget had $6 million of
spending. The amendment would add another $1.5 million
bringing the total to $7.5 million. In other words, all of
the projected revenue would not be fully expended.
Representative Pruitt referred to the alcohol fund which
had additional funds in the account and had been reduced
over time. He did not necessarily see additional money in
the recidivism fund. It sounded like there would be an
extra $1.5 million that could be carried over into the
future year. He believed there would be a greater need to
utilize the recidivism fund going forward. He spoke about
the demand on the fund in future years.
Ms. Sanders did not have the ability to project what the
demand on the fund would be. She thought the Department of
Health and Social Services (DHSS) might be able to define
the demand. The Legislative Finance Division (LFD) used the
Department of Revenue (DOR) for its source of projections.
There was a substantial increase in revenue as the
marijuana tax built up. She reported that in FY 18 $4.6
million of revenue was projected in the recidivism
reduction fund. Revenues were anticipated to increase to to
$9 million in FY 19, a substantial increase. She was
uncertain where things would level out. Revenue would have
to be watched yearly until a stable source of revenue was
determined.
2:26:23 PM
Representative Pruitt did not want to be faced with a
similar challenge for the recidivism reduction fund that
the legislature had faced with the alcohol fund.
Representative Guttenberg relayed a story about a parent
talking to him about all of the money going into the
recidivism fund to keep people out of a cycle. The parent
told of their child approaching them about needing
treatment for either drug or alcohol addiction. He
indicated that when a person admitted they needed help,
they had a higher chance of success. The parent was not
able to get their child into a treatment program for a
significant amount of time. The child was sent outside in
search of treatment. He understood recidivism was important
but noted that preventing a person from their first crime
was equally important.
Co-Chair Seaton provided wrap up on the amendment. He
relayed that the amendment would only take half of the
excess funds. The fund was growing with the increase of
marijuana taxes. He did not believe marijuana taxes would
be reduced in the near future. He asked members for their
support of the amendment.
Representative Wilson MAINTAINED her OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Gara, Grenn, Guttenberg,
Kawasaki, Ortiz, Seaton, Foster
OPPOSED: Tilton, Wilson
The MOTION PASSED (9/2). There being NO further OBJECTION,
Amendment H HSS 11 was ADOPTED.
2:29:15 PM
AT EASE
2:51:17 PM
RECONVENED
Representative Tilton MOVED to ADOPT Amendment H HSS 12
(copy on file):
Behavioral Health
Behavioral Health Administration
H HSS 12
Travel and Commodities Reduction Based on FY17 Actual
Levels Plus Adjustment for CPI
Offered by Representative Tilton
Decrement to Travel and Commodities from 2017 Actual
Levels plus adjustment for CPI
Vice-Chair Gara OBJECTED for discussion.
Representative Tilton read the amendment (see above). The
reduction would total $100,000. She conveyed that the
travel under the travel line was for out-of-state travel
which had doubled.
Vice-Chair Gara stated that the section of the department
had been very efficient. There were more people receiving
behavioral health services than ever before and there was
no end in sight. The department's budget had been reduced
by $19 million in recent years. The department had
leveraged more federal funds than the legislature had cut
to try to address the growing need for services. He
continued that in terms of administration, the budget had
been flat even though the administration was serving more
and more people. The administration budget was $107,000
less than it was in FY 17. Travel was used in behavioral
health to visit grantees to make sure they were complying
with the law, for training, and for grantees to do Medicaid
billing. It was also used by regional and community
providers to help with grants and billing. It was used to
supervise staff around the state. The division had been
trying to serve a growing number of people at a reduced
cost.
2:54:08 PM
Representative Wilson asked how the travel and commodity
part had been impacted. She would be supporting the
amendment. Representative Tilton relayed that the amendment
would impact the travel line, but it was the out-of-state
travel that had more than doubled. She asked if there were
situations were the department was traveling out-of-state
to check on beneficiaries.
Vice-Chair Gara answered that the out-of-state travel costs
were a fraction of the item. The grantees were obviously in
the state. The amendment would reduce the travel budget by
13 percent and the commodities budget by 26 percent for a
division serving a growing number of people.
Representative Tilton commented that the amendment would
reduce travel. The outside travel had more than doubled
over the previous year. The amendment reflected actuals.
However, she used final costs rather than actuals. Actuals
would have been 3 times more that the final costs in the
reduction. She asked for support of the amendment.
Vice-Chair Gara MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Thompson, Tilton, Wilson, Pruitt
OPPOSED: Gara, Grenn, Guttenberg, Kawasaki, Ortiz, Foster,
Seaton
The MOTION to adopt Amendment H HSS 12 FAILED (4/7).
2:56:24 PM
Vice-Chair Gara requested to consider Amendments H HSS 13
and H HSS 24 simultaneously. He explained that H HSS 13 and
H HSS 24 were Alaska Psychiatric Institute (API) related.
He explained that in the mid-2000s API was supposed to be a
140-bed facility with about 30 beds for criminal (forensic)
patients. Instead it was an 80-bed facility with 10
forensic beds. He reported that of those 80 beds about 10
to 15 beds were under reconstruction to meet federal
standards. He opined that Alaska was at a crisis level
treating its psychiatric patients. Currently about 30
percent of the patients that left API after an
unjustifiable waiting list were back at API within 180
days.
Co-Chair Seaton aske Vice-Chair Gara to move the
amendments.
Vice-Chair Gara MOVED to ADOPT Amendments H HSS 13 and H
HSS 24 (copy on file):
H HSS 13:
Behavioral Health
Behavioral Health Administration
H HSS 13
One-time Funding for Study on Improving Alaska's
Capacity to Treat Defendants with Acute Mental Health
Needs
Offered by Representative Gara
Funding will be used to examine Alaska's capacity to
provide forensic mental health services, including an
assessment of population needs, and options for
improving and expanding those services.
Unlike most states, Alaska does not have a "forensic"
hospital, although it does have a 10-bed "medium
security" forensic unit located within the Alaska
Psychiatric Institute (API).
The study being requested is part of an effort to see
if patients served by API can be served better.
Studies culminating in 2005 recommended a 140-bed
facility at API, including 40 forensic beds; however,
API was built with a capacity for 80 patients, and
only 10 forensic beds.
Moving API's current 10 forensic beds to another
location would free-up beds inside API that are
desperately needed to address the waiting lists at API
for court-ordered adult acute civil, involuntary
admissions. Due to the lack of beds, almost all
patients are being held in emergency departments
around the state awaiting transfer.
Forensic services are mental health services
specifically provided to justice-involved individuals
(defendants). One of the more common forensic issues
facing courts is whether a criminal defendant has the
mental capacity to participate in his/her legal
proceedings and whether the individual has the
capacity to exercise his liberty to pursue his or her
interests during the trial.
Populations who could be served by mental health
services provided in a forensic hospital include:
-- Pre-trial detainees held in correctional
facilities who need competency (to stand trial)
evaluations by API psychologists;
-- Defendants found incompetent to stand trial and
referred to API's forensic
unit for "restoration to competency" in order to stand
trial;
-- Persons found incompetent to proceed to trial
(known as "non-restorable" to competency) and civilly
committed to API for treatment, as well as seriously
mentally ill persons who are violent or convicted of
sex offenses whose difficult behaviors create
significant community discharge placement options.
-- Inmates sentenced to correctional facilities in
need of inpatient psychiatric care, including those
who are found Guilty but Mentally Ill
This proposed feasibility study will estimate the
potential number of forensic beds needed to adequately
address these various, complex populations.
The study would be multifaceted in that it would
involve the following considerations: populations and
potential numbers of persons to be served in a
forensic hospital; possible locations in Anchorage;
accreditation concerns arising from the relocation;
staffing issues; transportation needs; the cost of any
identified facilities; and the retrofitting and
operating cost comparisons between identified
potential locations and facilities. If this proposal
is not funded the demands on API will continue and the
"boarding" of psychiatric patients in hospital
emergency departments across the State will continue.
H HSS 24:
Medicaid Services
Behavioral Health Medicaid Services
H HSS 24
Transfer MHTAAR to Behavioral
Health for Study to Improve Capacity to Treat
Defendants with Acute MH Needs
Offered by Representative Gara
The Mental Health Trust has expressed verbal support
for this study and movement of these funds from the
Medicaid Services appropriation/Behavioral Health
allocation to the Behavioral Health
appropriation/Behavioral Health Administration
allocation. Board approval is anticipated at the
Mental Health Trust's next meeting in May 2018.
Representative Wilson OBJECTED.
Vice-Chair Gara continued that the amendment was part of an
effort to address the underserved population - people with
acute mental illness who were potentially dangerous to
themselves or the public. He reported having spoken to the
Alaska Mental Health Trust who was going to match $159,000
with $159,000 of state money for a feasibility study to
find another location for forensic patients. The idea was
to free up space at API to avoid API becoming a revolving
door for patients. He hoped more treatment would be
available to patients, and patients would be more stable
when they came out. He continued that the CEO of the Mental
Health Trust was confident that the board would approve
their share of $159,000, however, the board did not meet
until April. He elaborated that H HSS 24 moved the funding
to the correct allocation from Behavioral Health Medicaid
to Behavioral Health Administration.
2:59:26 PM
Representative Grenn talked with a woman the previous
weekend who worked at API. She had a colleague who had her
arm broken by a violent mentally ill person. The
representative had a great conversation with the woman
about what was going on at API and the passion she had for
patients. He thought the work done by the representative
from downtown Anchorage was commendable. He would be
supportive of the amendment.
Representative Kawasaki referred to Amendment H HSS 13. He
asked if patients remanded by the courts to serve and who
were serving at API were eligible for Medicaid. He noted
that he served on the DOC budget subcommittee with
Representative Wilson. They had discussed sending prisoners
with the costliest medical expenses to facilities in the
Lower 48 where healthcare could be provided at a cheaper
rate. He wondered if there was potential savings for
incarcerated individuals staying at API to be housed in
facilities outside of Alaska.
Vice-Chair Gara answered that Medicaid Disproportionate
Shared Hospital (DSH) payments were a form of Medicaid used
by the incarcerated patient population - Medicaid match
funding. He furthered that the courts referred forensic
patients to API. He reported that API had no choice but to
accept them, which decreased the number of beds for people
who had committed no crimes but had psychiatric illnesses.
He had not analyzed whether to send people out of state. He
did not have information from the department. He relayed
that the department had a study on the street about
expanding API to avoid waiting lists and to provide needed
continuity of care. He would want certain questions
answered before implementing a policy of sending patients
out of state without family support.
Representative Wilson did not believe the question had been
answered. She wondered whether Medicaid expansion would
cover prisoners. She wondered if they would be eligible
because API was a state facility. Vice-Chair Gara deferred
to the department.
JON SHERWOOD, DEPUTY COMMISSIONER, DEPARTMENT OF HEALTH AND
SOCIAL SERVICES, responded there was a federal prohibition
for regular Medicaid to pay for services in institutions
for mental disease for individuals age 21 thru 64. Most of
the corrections population would not be eligible for
treatment in a psychiatric institute, state or otherwise,
thru Medicaid. The expansion population, if in correctional
custody were not eligible for Medicaid unless they
overnighted in an inpatient facility. However, because
Medicaid did not cover institutions for mental disease for
ages 21 thru 64 there would be no Medicaid coverage.
3:04:47 PM
Representative Wilson appreciated the commissioner's
explanation. She thought the amendment was about a study to
see if there was another facility that could be utilized.
She asked for additional detail about the study and its
purpose. She mentioned retrofitting and operating cost
comparisons between identified potential locations. She
wondered if the state was looking to lease or buy another
facility. She asked for more specifics regarding expansion.
Vice-Chair Gara answered that the study would be contracted
out to find the most appropriate place for forensic
patients. He thought the location would have to be within
Alaska. The facility could be a privately-operated
institution. The study was to determine the best way to
serve the specific forensic patient population. Unlike
Alaska, most states had a separate forensic unit for people
coming through the criminal system. He indicated that
Alaska put people who went through the criminal system in
the same place as other API patients. The practice was not
ideal, especially because there was already a shortage of
treatment rooms for API patients without criminal records.
Representative Wilson asked how the study would be
different than the study currently being conducted
regarding API.
Vice-Chair Gara answered that the study on the street did
not pertain to the forensic population. Rather, it looked
at expanding API. The study would consider what capacity
was needed at API to avoid people having to be on a
waitlist or having to go to hospital emergency rooms until
being admitted to API. Many people were kept for a very
short time at API because of the number of people on the
waitlist. Patients were discharged, but typically returned
to API within 180 days. The study would determine the
proper size of API. He reported that in the mid-2000s the
study showed the need for a 140-bed facility.
Representative Wilson asked if an expansion could also
include more forensic space. She thought the expansion
portion could overlap based on what the amendment stated.
Vice-Chair Gara clarified that the amendment was not to
fund patients but to find an appropriate location for
forensic patients separate from API. The idea was to free
up space at API for non-criminal patients in need. The
current study did not address the issue.
3:08:43 PM
Representative Tilton asked whether patients who were
unable to get into API and who were sitting in hospitals
covered by DSH funds would be covered by DSH funds. Mr.
Sherwood answered that a number of people who could not get
into API were people who needed to be evaluated or restored
to competency for trial. They would be sitting in jails if
they did not get into API while they waited to be evaluated
or treated for competency. They composed the primary
population served by forensic beds.
Vice-Chair Gara indicated that he had tried to find
matching funds to reduce the state's costs on all of the
API amendments. He suggested that if the legislature did
not do something, someone would get hurt or die. He
appreciated the CEO of the Alaska Mental Health Trust
stating that he would advocate for the matching funds.
Representative Wilson MAINTAINED her OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Gara, Grenn, Guttenberg, Kawasaki, Ortiz,
Thompson, Seaton, Foster
OPPOSED: Tilton, Wilson, Pruitt
The MOTION PASSED (8/3). There being NO further OBJECTION,
Amendments H HSS 13 and H HSS 24 were ADOPTED.
3:10:58 PM
Vice-Chair Gara MOVED to ADOPT Amendment H HSS 14 (copy on
file):
Behavioral Health
Behavioral Health Administration
H HSS 14
Annual Reports to Legislature on Use of Federal
Disproportionate Share Hospital Funds
Offered by Representatives: Gara, Tilton
Wordage:
It is the intent of the legislature that the
Department of Health and Social Services submit a
report to the co-chairs of the Finance Committees and
Legislative Finance Division by November 15 of 2019,
2020 and 2021 on 1) disbursement and use of federal
Disproportionate Share Hospital (DSH) dollars by
community and regional hospitals, 2) the annual amount
of federal DSH funds which the state is not claiming,
and 3) future strategies for claiming those funds,
including the possibility of hospitals matching those
funds, to improve outcomes for patients, providers and
the public.
Explanation:
Disproportionate Share Hospital (DSH) funds are
provided to state and community hospitals that serve a
significantly disproportionate number of low-income
patients and receive payments from the Centers for
Medicaid and Medicare Services to cover the costs of
providing care to uninsured patients. In recent years,
Alaska has not claimed roughly $10 million annually in
DSH funds it is eligible for, yet many hospitals in
Alaska critically need funds to deal with overflow
from the Alaska Psychiatric Institute and meet other
needs. This on Use of Federal Disproportionate Share
Hospital Funds (continued) language states legislative
intent that the Department report annually on its use
of those funds, on the amount of funds not claimed,
and steps it is exploring to ensure Alaskan hospitals
benefit to the maximum extent possible.
Representative Guttenberg OBJECTED for discussion.
Representative Tilton explained the amendment was in regard
to the Disproportionate Share Hospital (DSH) funds that
were discussed earlier in the meeting. The amendment
advocated for intent language that would require a report.
She read a portion of the amendment (see above). She
indicated that having some data and information would help
the legislature to know regionally where the funds were
going and what the need was. There were DSH funds sitting
available. She asked what the legislature's plan was to
maximize the usage of those funds.
Representative Wilson began asking a question regarding a
different amendment. Representative Tilton clarified that
the amendment was a request for a report from the
department regarding the usage of DSH funds.
Representative Wilson asked Representative Tilton to
explain DSH funds. Representative Tilton replied that
Disproportionate Share Hospital funds were federal matching
dollars for uncompensated care.
Vice-Chair Gara stated there was roughly $10 million in
federal DSH funds available that the state could match on a
50/50 basis. However, the state did not have the matching
funds presently. The current circumstance was that patients
needing care at a facility like API were sitting in
emergency rooms while waiting for space at a facility to
become available. In some cases, the patients were violent.
The amendment would help monitor and determine the best use
of DSH funds and the best way to leverage what the state
could not afford to leverage presently. He thought
Representative Tilton had a good idea to ask for an annual
report on the use of DSH funds.
Representative Guttenberg WITHDREW his OBJECTION.
There being NO further OBJECTION, Amendment H HSS 14 was
ADOPTED.
3:15:10 PM
Vice-Chair Gara requested simultaneous consideration of
Amendments L H HSS 15, H HSS 16, H HSS 25, H HSS 26.
Vice-Chair Gara MOVED to ADOPT Amendments L H HSS 15, H HSS
16, H HSS 25, H HSS 26 (copy on file):
L H HSS 15:
Behavioral Health
Designated Evaluation and Treatment
L H HSS 15
3-Year State Matching Funds Totaling $10.5 Million to
Support Hospital-Based Mental Health Care (FY19-21)
Offered by Representatives: Gara, Seaton
30-GH2564/O.24
In recent years, Alaska has not claimed all of the
federal Disproportionate Share Hospital (DSH) funding
to which it is entitled due to a lack of matching
funds and federal receipt authority. With a commitment
of $10.5 million in Alaska Comprehensive Health
Insurance (ACHI) funds in FY2019, the State would be
able to leverage an additional $10.5 million of
federal DSH funds between FY19 and FY21.
Currently, there is a major gap in the Alaska
Psychiatric Institute's (API) ability to admit
patients, due to its limited capacity of 80 beds.
Although API is claiming all of the DSH funding to
which it, as Alaska's only public psychiatric
hospital, is currently entitled, the State could claim
a portion of its unused DSH funds to support other
hospitals and community behavioral health programs
that are especially impacted by the lack of treatment
beds at API.
Specifically, these additional funds would enhance the
capacities of the State's three existing DSH-funded
hospital-based mental health treatment programs and
provide new financial support to approximately three
other hospitals impacted by the lack of treatment beds
at API.
These hospitals have been working hard to provide and
maintain safe environments for patients who are court-
ordered to psychiatric evaluation and treatment at API
(or one of the other two Designated Evaluation and
Treatment hospitals). Many of these patients are being
held for days and sometimes longer in their hospitals'
emergency departments awaiting transfer to API.
Services provided would depend on what the hospital
and, in some cases, the local community behavioral
health center determines makes the most sense for
their hospital/community, ranging from physician
(including psychiatric) and social work services,
additional security guards and substance use or mental
health services (assessments, evaluations), to
discharge planning and converting emergency rooms to
safe rooms, etc., all geared towards providing more
appropriate services for the mentally ill and
relieving the stress and pressures on emergency
departments.
While two other existing hospitals have approved
Certificates of Need to expand services to provide
treatment for people who would qualify for API
admission, these new services will not be online until
early 2019 and 2020, and ultimately are not
anticipated to meet the existing need. Further, the
Department of Health and Social Services has submitted
the Section 1115 Behavioral Health Medicaid Waiver
application to the Centers for Medicare and Medicaid
Services (CMS) which will help increase access to
community-based behavioral health services. Service
implementation will take multiple years and although
it is anticipated to begin in 2020, it will be based
on negotiations with and approval by CMS.
This enhanced DSH funding would enable the State to
help address a demonstrated crisis in the provision of
adequate and appropriate hospital-level care for
Alaskans experiencing a mental health crisis. Without
additional resources there will continue to be
expensive uncompensated care at medical facilities for
patients they hold, waiting for API admission.
H HSS 16:
Behavioral Health
Designated Evaluation and Treatment
H HSS 16 - Reverse IncT for ACHI Funding
Request Is Included in Language Section
Offered by Representative Gara
Funding is being requested as a multi-year (FY19-FY21)
language item and should not be duplicated in the
numbers section.
H HSS 25:
Medicaid Services
Health Care Medicaid Services
H HSS 25
Reverse IncT for Federal to Match GF - Request is
Included in Language Section
Offered by Representative Gara
Funding is being requested as a multi-year (FY19-FY21)
language item and should not be duplicated in the
numbers section.
H HSS 26:
Medicaid Services
Health Care Medicaid Services
L H HSS 26 - 3-Year Federal Matching Funds Totaling
$10.5 Million to Support Hospital-Based Mental Health
Services
Offered by Representatives: Gara, Seaton
30-GH2564O.24
In recent years, Alaska has not claimed all of the
federal Disproportionate Share Hospitals (DSH) funding
to which it is entitled due to a lack of matching
funds and federal receipt authority. With a commitment
of $10.5 million in Alaska Comprehensive Health
Insurance (ACHI) funds in FY2019, the State would be
able to leverage an additional $10.5 million of
federal DSH funds between FY19 and FY 21.
Currently, there is a major gap in the Alaska
Psychiatric Institute's (API) ability to admit
patients, due to its limited capacity of 80 beds.
Although API is claiming all of the DSH funding to
which it, as Alaska's only public psychiatric
hospital, is currently entitled, the State could claim
a portion of its unused DSH funds to support other
hospitals and community behavioral health programs
that are especially impacted by the lack of treatment
beds at API.
Specifically, these additional funds would enhance the
capacities of the State's three existing DSH-funded
hospital-based mental health treatment programs and
provide new financial support to approximately three
other hospitals impacted by the lack of treatment beds
at API.
These hospitals have been working hard to provide and
maintain safe environments for patients who are court-
ordered to psychiatric evaluation and treatment at API
(or one of the other two Designated Evaluation and
Treatment hospitals). Many of these patients are being
held for days and sometimes longer in their hospitals'
emergency departments awaiting transfer to API.
Services provided would depend on what the hospital
and, in some cases, the local community behavioral
health center determines makes the most sense for
their hospital/community, ranging from physician
(including psychiatric) and social work services,
additional security guards and substance use or mental
health services (assessments, evaluations), to
discharge planning and converting emergency rooms to
safe rooms, etc., all geared towards providing more
appropriate services for the mentally ill and
relieving the stress and pressures on emergency
departments.
While two other existing hospitals have approved
Certificates of Need to expand services to provide
treatment for people who would qualify for API
admission, these new services will not be online until
early 2019 and 2020, and ultimately are not
anticipated to meet the existing need. Further, the
Department of Health and Social Services has submitted
the Section 1115 Behavioral Health Medicaid Waiver
application to the Centers for Medicare and Medicaid
Services (CMS) which will help increase access to
community-based behavioral health services.
Service implementation will take multiple years and
although it is anticipated to begin in 2020, it will
be based on negotiations with and approval by CMS.
This enhanced DSH funding approach would enable the
State to help address demonstrated crisis in the
provision of adequate and appropriate hospital-level
care for Alaskans experiencing a mental health crisis.
Without additional resources there will continue to be
expensive uncompensated care at medical facilities for
patients they hold, waiting for API Eliminates funding
for this increment added in the Governors FY19 budget.
Representative Wilson OBJECTED.
Vice-Chair Gara explained that the Amendment would delete
Amendments H HSS 16 and H HSS 25 and replace them with
Amendments H HSS 15 and H HSS 26. The finance subcommittee
passed an amendment to leverage $1.9 million of federal DSH
funds with $1.9 million in funds from different sources. He
mentioned the state would be receiving $85 million in ACHI
funds, $25 million of which the state had already received
from Premera. The state had stabilized their costs and the
excess profit was $25 million. The federal government would
be returning about $60 million of the funds the state
appropriated.
Vice-Chair Gara informed the committee that the hospitals
came to him reporting that API patients were being housed
in hospital emergency rooms. The hospitals could only bill
for 1 day of their stay. The hospitals were not providing
these patients with psychological treatment, social work,
or the treatment they needed. However, they were kept in
the emergency room because the hospitals had to. At some
point, these patients made it to API, but after several
days.
Vice-Chair Gara thought matching $1.9 million of ACHI funds
to leverage $1.9 million of federal funds would be a great
solution. The amount divided between hospitals equaled less
than $1 million per hospital. The hospitals wanted to use
the funds to hire security and possibly build security
walls or secured rooms. He relayed a story of a doctor
getting punched by a patient and having a black eye. He
realized that $1.9 million would make some difference but
not a big difference. The amendment outlined that for a
temporary 3-year program, $3.5 million per year in ACHI
funds and $3.6 million would be leveraged in DSH funds. The
amounts should provide hospitals an adequate sum to build
secured rooms, hire security, and to provide social work
and behavioral health treatment to patients as they waited
in an emergency room. It was costing hospitals a
significant amount of money and costing patients in terms
of their care.
3:19:39 PM
Representative Grenn asked which hospitals would be
affected by the amendment. Vice-Chair Gara replied that the
DSH formula was based on the percentage of Medicaid-
eligible patients it served. He suggested that a hospital
in a place like Orange County, California would not be
eligible, but most hospitals in Alaska would meet the
Medicaid standards. Places such as Providence Hospital,
Mat-Su Regional Hospital, Alaska Regional Hospital, and
Bartlett Hospital would qualify. There was a question about
whether hospitals receiving tribal funding would qualify.
He thought there were 2 or 3 hospitals housing patients in
their emergency rooms currently. He confirmed that Alaska
Regional Hospital and Providence Hospitals were on the
list. He thought roughly six were participating.
Representative Guttenberg asked for a guesstimate of the
total amount of uncompensated services in the area of API
across the medical community in Alaska. Vice-Chair Gara
replied that the director at API believed it was more than
the money being appropriated in the amendment. He decided
the amount of $3.5 million each year for 3 years was a
responsible amount to use from the returned ACHI funds. He
was aware there were folks in the building looking to use
the funds for other things. He was proposing to use $10.5
million of ACHI funds over three years to leverage $10.5 of
federal funds. The cost to the hospitals was greater.
Representative Guttenberg suggested that the assumption
with the report and building out the space, hospitals would
have the ability to house more people and be compensated.
He thought the number would go down and the communities
would be safer.
Vice-Chair Gara replied that it was not the ideal way to
serve the patients - it was a temporary three-year
solution. He detailed that by the end of 2020 the state
hoped to qualify for a federal 1115 waiver. It would be a
waiver that would hopefully divert people away from places
like API with early intervention. Regarding Alaska Regional
Hospital and Mat-Su Regional Hospital, one was committed to
and the other was considering opening up a psychiatric
ward. Other hospitals around the state were making the same
considerations. In combination with the 1115 waiver that
began in 2020 and the additional rooms in hospitals would
be part of the solution but did not exist currently.
3:24:01 PM
Representative Wilson expressed confusion about the
amendment. She thought the intent of Amendment H HSS 14 was
to determine what could be done with the money. Currently,
Amendment H HHS 15 was appropriating $10.5 million from
ACHI funds prior to receiving the report proposed in
Amendment H HSS 14, which she was uncomfortable with. She
felt the legislature was guessing how the funds could be
used. She did not know the parameters of the ACHI funding.
She indicated that the hospital in Fairbanks had a ward,
although not very large. She thought the legislature was
getting ahead of itself.
Vice-Chair Gara replied that the legislature was not
jumping ahead. He stressed that if something was not done
someone would get hurt. He thought patients would become
more expensive sitting in the wrong place for too long. The
purpose of Amendment H HHS 14 was to figure out a way to
better leverage federal dollars and to monitor how they had
been used and how effectively. The legislature, the
department, and the hospitals convened to determine the
things that would be done including building secure rooms,
providing heightened security, providing social work, and
providing needed treatment. He emphasized that the
population he was talking about consisted of people in
danger of hurting themselves or others. He summarized a
letter from an emergency room doctor who was in fear of her
staffs' safety all day because of the patients her hospital
was holding in the Mat-Su area.
Representative Wilson clarified that she was not advocating
for doing nothing. She noted that Vice-Chair Gara had
listed items that she did not believe were covered. She
thought the committee should wait to allocate the ACHI
funds. She suggested using the $1.9 million with the
matching funds and then wait.
3:28:03 PM
Vice-Chair Gara referred to a letter from the Alaska State
Hospital and Nursing Home Association (ASHNHA)that stated
exactly how they would use the funds. It would be different
for each hospital, but the funds would be used for
physicians, social work services, security guards,
substance use, mental health services, assessment,
evaluation, discharge planning capacity, and renovated
emergency rooms to provide for secured segregation of
certain patients from kids or families. They were examples
of the things the hospitals would try to juggle with the
limited amount of funding.
Representative Grenn tended to agree with Representative
Wilson about the study in Amendment H HHS 14. However, the
legislature would not receive a report until November 2019.
He thought waiting 18 months for a report to address a need
was immediate was too long. He asked if the $10.5 million
was a minimum investment amount by the state. He wondered
where the figure came from.
Vice-Chair Gara replied that they could go back to $1.9
million, but it would provide a limited amount of funds.
The $3.5 million would provide a somewhat adequate amount
distributed between hospitals. There was no minimum or
maximum. There was roughly $10 million that the state could
match 50/50. The state did not have $10 million available,
but it had $3.5 million in the returned ACHI funds. He
stressed that they could not have a system where doctors,
nurses, and other patients were being assaulted.
3:30:50 PM
Co-Chair Seaton relayed that the ACHI money was one-time
funding done on a 3-year increment. The problem was that
behavioral Health was the least adequately funded in the
State of Alaska. The money would help. The ACHI funding was
insurance money.
Representative Thompson recalled receiving a letter from
ASHNHA asking legislators to support the $3.9 million
because it would be leveraged into $3.7 million. He was
confused by the figures.
Vice-Chair Gara replied that his office, the department,
and the hospitals came up with the amendment. He told them
what he thought the state could afford it in terms of the
ACHI funds. They came back to the state to relay that not
all items could be provided. Representative Seaton had
suggested handling the issue in a manner that would allow
the hospitals to get the funds they needed to house and
help these people for a 3-year period while waiting for the
1115 waiver to go into effect.
Co-Chair Seaton added that the $10 million DSH funds would
have reverted back to the federal government without the
amendment. The question was whether the state needed the
facilities and treatment in Alaska.
Representative Pruitt had a question about the ACHI funds.
He pointed out that the returned $25 million from the ACHI
fund was already slated for use in another manner.
Currently, there was a bill on the House floor that would
use $30 million from the ACHI fund to fund community
revenue sharing. He asked if the fund could be used for
various purposes. He asked someone to comment on the
viability of the fund.
Co-Chair Seaton asked someone from Legislative Finance
Division to come to the table.
Ms. Sanders responded that when the initial reinsurance
program began, there were 3 years of premium insurance
taxes that were deposited into the ACHI fund. She relayed
that for FY 16, FY 17, and FY 18 $60 million went into each
year totaling about $175 million. There was an initial
appropriation of $55 million for the FY 17 reinsurance
program. The State of Alaska applied for the 1332 waiver
and was approved, which changed the reinsurance program to
be partially federally funded and partially state funded.
There was a second appropriation for $55 million that was
going to cover FY 18 thru FY 23. Approximately $11 million
per year would have been used to match $44 million federal
funds. Those were the only 2 appropriations made from the
fund. After FY 17 was completed Premera returned $25
million to the State of Alaska because insurance premium
costs were lower than anticipated. It left about $93
million in the ACHI Fund. The other bill Representative
Pruitt was speaking to used approximately $25 million still
leaving money available for other uses.
3:37:10 PM
Representative Pruitt asked if any additional funds were
being added to the fund. Ms. Sanders replied that the
existing statute was scheduled to sunset at the end of FY
18. No future deposits would be made into the ACHI fund.
The insurance premium taxes would revert back to the
general fund.
Representative Pruitt asked if she anticipated any demand
on the fund in the future. Ms. Sanders responded that LFD's
recommendation was to leave a small balance of less than
$10 million in the fund to address any potential unforeseen
cost that might arise between now and FY 22, 5 years from
now. Recently, there was a press release by the governor's
office that the federal portion that was going to be
covered in FY 18 was higher than anticipated. The state was
heading in a direction where more costs were being covered
by the federal government more than LFD had anticipated
with the $11 million and $44 million split. The Legislative
Finance Division's recommendation was to leave a small
balance. However, there was funding available presently to
appropriate elsewhere.
Representative Wilson WITHDREW her OBJECTION.
There being NO further OBJECTION, Amendments H HSS 15, H
HSS 16, H HSS 25, H HSS 26 were ADOPTED.
3:39:47 PM
Representative Tilton MOVED to ADOPT Amendment H HSS 17
(copy on file):
Health Care Services
Medical Assistance Administration
H HSS 17
Commodities Reduction Based on FY17 Actual Levels Plus
Adjustment for CPI
Offered by Representative Tilton
Decrement Commodities from 2017 Actual Levels plus
adjustment for CPI
Vice-Chair Gara OBJECTED for discussion.
Representative Tilton read the amendment (see above).
Vice-Chair Gara spoke in opposition of the amendment. He
conveyed that although he understood the motivation for the
amendment, he did not agree with the policy. He noted that
the proposed cut of $43,600 were matching funds. Therefore,
the reduction was actually $87,000. It was a 54 percent
reduction in the commodities line. Medicaid assistance
administration served roughly 30,000 more Medicaid
recipients than the state had 4 years prior. However, their
budget had remained relatively flat. Commodities could be
computers, standing desks for workers, or a number of other
things. He could not think of a good justification for
taking away $87,000 in funding, half of which was federal
funding.
Representative Tilton relayed that under the commodities
line in the FY 17 actuals it stated that it was $48,000 and
the FY 19 request was $160,000. She thought it was a
significant increase for office and business supplies. She
asked for support on her amendment.
Vice-Chair Gara MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson
OPPOSED: Grenn, Guttenberg, Kawasaki, Ortiz, Gara, Seaton,
Foster
The MOTION to adopt Amendment H HSS 17 FAILED (4/7).
3:43:31 PM
Co-Chair Seaton WITHDREW original L H HSS 18 (copy on
file).
Public Assistance
Alaska Temporary Assistance Program
HSS 18 - Funding to Satisfy Federal
Maintenance of Effort Requirements (FY19-FY20)
Offered by Representative Seaton
See 30-GH25640.30
In FY18 the Department of Health and Social Services
has requested a supplemental of $2 million to satisfy
federal maintenance of effort requirements and avoid
federal penalties that would also impact the FY19
budget. Given the current FY18 problem, this amendment
adds $4 million of one-time funds that may only be
used to satisfy MOE requirements in FY19 and FY20. The
fund source is the Commercial Charter Fisheries
Revolving Loan Fund. The fund has nearly $5 million,
only one $28.1 loan is outstanding, the loan to asset
ratio is an extremely low 1%, and projected loan
demand is just $45.0 per year. The remaining net cash
available for loans would be approximately $787.0 with
a very low loan to asset ratio of 17%.
Co-Chair Seaton MOVED to ADOPT Replacement Amendment H HSS
18 (copy on file):
Public Assistance
ATAP
Replacement H HSS 18
Offered by: Representative Seaton
Funding to Satisfy Federal Maintenance of Effort
Requirements (FY19-FY20)
Language, MultiYr
Explanation:
See 30-GH2564O.31
In FY18 the Department of Health and Social Services
has requested a supplemental of $2 million to satisfy
federal maintenance of effort requirements and avoid
federal penalties that would also impact the FY19
budget. Given the current FY18 problem, this amendment
adds $3 million of one-time funds that may only be
used to satisfy MOE requirements in FY19 and FY20.
The fund source is the Commercial Charter Fisheries
Revolving Loan Fund. The fund has nearly $5 million in
cash, only one $28.1 loan is outstanding, the loan to
asset ratio is an extremely low 1 percent, and
projected loan demand is just $45.0 per year. The
remaining net cash available for loans (assuming H DFG
18 is also adopted) would be approximately $787.0 with
a very low loan to asset ratio of 17 percent.
Representative Wilson OBJECTED for discussion.
Co-Chair Seaton read the amendment (see above).
3:44:56 PM
Representative Wilson discussed her objection. She reported
in the prior year the legislature moved money from one area
and asked if it would affect the federal maintenance of
effort requirements. She recollected that the legislature
was told no. Presently, it appeared that it was not
necessarily true. She reported that about $2 million was
moved from the Public Assistance Program to the Office of
Children's Services. She wanted to verify whether the
transfer was the cause of the state's current issue.
Vice-Chair Gara replied that the legislature had
transferred excess public assistance funds. The legislature
met its adult public assistance needs in the prior year.
The legislature did not underfund adult public assistance
by moving those funds.
Representative Wilson wondered about the source of the
problem of not meeting the requirement. She thought
something had changed.
Co-Chair Seaton invited a representative from LFD to the
table.
KELLY CUNNINGHAM, ANALYST, LEGISLATIVE FINANCE DIVISION,
asked Representative Wilson to restate the question.
Representative Wilson complied.
Ms. Cunningham answered that a $7 million cut in FY 17 and
an additional $3 million cut in FY 18 were the causes.
However, the legislature gave the department intent to hire
a contractor to seek out third party claiming. The
department was successful at identifying $8.9 million in
third party claiming for the last year. She noted the prior
year was only $2.9 million. They were not able to identify
enough third party claiming to make up the shortfall of the
$3 million reduction from the prior year. The department
received the reduction in hopes that they could identify
additional third party claiming, however, it did not pan
out as anticipated.
Representative Wilson asked where the money would be spent,
as the money was a match rather than an ask to avoid losing
federal funds. Ms. Cunningham deferred to the department.
Co-Chair Seaton pointed out that there was a restriction in
the amendment that the money could only be used to satisfy
the maintenance of effort requirements in FY 19 and FY 20.
3:49:11 PM
Ms. O'Brien answered that one of the reductions the
department had taken was an offset for federal funding. The
department was increasing the state's federal authority for
the reduction it took in general funds. Currently, the
department was paying for the benefits with federal
authority. It would allow the state to pay for the benefits
with funding sources that allowed the department to meet
the maintenance of effort. In this case, it was a
designated general fund source which could also be used to
satisfy maintenance of effort.
Representative Wilson remained confused. She asked if the
state had to spend general fund money. She wondered if
general funds were being used to backfill to meet the
maintenance of effort.
Ms. O'Brien responded that the department's maintenance of
effort requirement for the Temporary Assistance for Needy
Families (TANF) block grant was about $36 million. The
requirement was an annual prerequisite regardless of how
much money the state actually spent on the program.
Fortunately for Alaska, it spent enough for the program in
various ways that the state had those expenditures to
spend. In other words, the state spent at least $36 million
for eligible expenditures for the TANF program. Currently,
the state was spending federal funds in addition to general
funds on temporary assistance program benefits. The
amendment would allow the department to meet the
maintenance of effort without having to pay a penalty or
fine. Presently, the state was spending the following
year's money trying to meet the maintenance of effort in
advance. If the state were to get penalized or fined, the
state would continually be behind and would have to ask for
supplementals to address the need with the federal
government.
Representative Wilson suggested that if the maintenance of
effort was not required, the department would not need the
money as the program was running without it. She asked
about the amount of the penalty and whether it was an
annual or monthly fine.
Ms. O'Brien replied that the requirement was an annual
obligation. The department had until the end of the federal
fiscal year to satisfy the requirement for the block grant
funds. The department received about $45 million in federal
funds in addition to the $36 million that it had to meet in
maintenance of effort. The program had the ability to spend
the total amount. The state did not have enough
expenditures to do so. She relayed that to the extent the
department was able to leverage those funds in other areas
such as the Child Advocacy Centers in OCS, and Childcare
Assistance. The department was using the federal funds for
leveraging purposes. The general fund spend was still
required.
Representative Wilson asked about the penalty. Ms. O'Brien
replied that the fine was dollar for dollar. She elaborated
that for every dollar the state did not satisfy for
maintenance of effort was the penalty. Co-Chair Seaton
added that the state not only got penalized, it had to make
the expenditures from the general fund. Representative
Wilson understood.
Vice-Chair Gara stated that the issue had arisen a couple
of years back. He asked for verification that the
maintenance of effort was a Medicaid requirement. Ms.
O'Brien replied in the negative. Vice-Chair Gara asked if
the maintenance of effort had to do with the Alaska
Temporary Assistance Program (ATAP). Ms. O'Brien responded
in the positive.
Vice-Chair Gara reported that there were cuts in ATAP and
the House Finance Committee was warned that the state would
be very close if not violating the maintenance of effort
requirements. The department sought and found private
spending. There was certain private spending that qualified
for maintenance of effort, so they were not using all state
funds to meet the maintenance of effort requirement. The
department had been as creative as possible, and the
legislature was warned.
Representative Ortiz supported the intent of the amendment
but had a question about the fund source. He asked if the
Department of Commerce, Community and Economic Development
(DCCED) had been notified about it coming from the
Commercial Charter Fisheries Revolving Loan Fund and
whether it approved it.
3:54:43 PM
AT EASE
3:55:12 PM
RECONVENED
Co-Chair Seaton replied that DCCED was notified and was
fine with the use of the funds, as they were not needed for
balancing loans. There were sufficient funds remaining to
make additional loans.
Representative Guttenberg asked how many maintenance of
effort components existed. Ms. O'Brien asked for
clarification.
Representative Guttenberg replied he was only speaking to
the specific program. He also asked how close the
department got to not meeting the maintenance of effort
requirements. Ms. O'Brien asked if he was talking about
just the one maintenance of effort or all of the different
maintenance of efforts. Representative Guttenberg asked her
to address the one being discussed.
Ms. O'Brien indicated that, with the particular program, in
past years the department mostly had not had an issue
meeting the maintenance of effort requirement. The Alaska
Temporary Assistance Program had a UGF budget of $13.9
million for many years. That program combined with the
Tribal Assistance Program was largely how the department
satisfied the maintenance of effort requirement. Several
years prior, the department was asked to find other sources
of funding to meet maintenance of effort. It hired a
contractor to help look at what other states were doing, to
explore other avenues, and to work with non-profit entities
to find out whether their data would be supportive. The
department was successful in achieving about a $3 million
in-kind maintenance of effort match. In the previous year,
the amount was increased by about another $5 million. The
department had experienced successes.
Ms. O'Brien continued that there was not always certainty
to the numbers; the department did not always know exactly
the value of the in-kind contributions. Typically, the
department had a general idea of its spending and was aware
of the amount needed to be made up. In some cases, the
department might transfer authority that was excess in
other places to help satisfy the gap. In the last several
years, the numbers had been very close. The department had
had a difficult time satisfying the requirements to the
point where the department exhausted all of the general
funds in the first quarter of the state fiscal year in
order to satisfy the federal fiscal year requirement. It
limited what it could do for the following fiscal year
which was where the department was at currently.
Representative Tilton asked about the funding source
number. Previously the committee had been discussing the
ACHI funds and relating those to health funds. She asked if
the ACHI funds could be used in place of the funding source
listed.
Ms. O'Brien was not familiar enough with the ACHI funding
source to know if there were any limitations in its ability
to match federal funds. She suggested that as long as it
was not matching another federal source it could likely be
used in that manner. The only requirement was that the
funds were not used to match some other federal funding
source.
Representative Tilton was asking the question because, if
it was already established that the ACHI funds were health
related and the funding source currently being used had
more to do with economic development, she thought the state
would be better served by using a different funding source.
4:00:08 PM
Co-Chair Seaton responded that the loan fund had had one
$28,000 loan with a 1 percent loan to asset ratio; over
time it had not been used. He questioned why the
legislature would allow that much funding to sit in an
account being underutilized. It was thought there would be
a higher demand for loans from the charter fishery
revolving loan fund. The demand was not there, and he
thought the proposed purpose would be an appropriate use of
the fund. The fund would increase to a 17 percent loan to
asset ratio - a very healthy ratio.
Representative Wilson asked if it was Co-Chair Seaton's
intent to look at other funds that could be utilized for
economic development in the capital budget. Co-Chair Seaton
answered that the item had been put forward in the past as
an economic development tool. It was not otherwise being
used as had been anticipated. He had not looked into
eliminating the program. He thought taking some money sent
a strong signal that if it was not being utilized, it would
be used somewhere else. They anticipated using $780,000 in
the coming year. It was using money that to-date had not
been used.
Representative Wilson was supportive of the amendment. She
highlighted that there were several smaller funds that
should be looked out. She thought if nobody was using the
funds, they could be used somewhere else. She was thankful
for the amendment.
Co-Chair Seaton appreciated Representative Thompson bring
forward the indirect expenditure report. He was trying to
be as efficient as possible.
Representative Pruitt believed a larger conversation should
take place about where to place the funds. In certain
cases, it might be appropriate to look at phasing some of
the funds out, if they were not being utilized as
anticipated. He suggested getting the state out of the
business of certain loans. He supported the amendment.
4:06:29 PM
AT EASE
4:19:54 PM
RECONVENED
Representative Wilson WITHDREW her OBJECTION.
Representative Kawasaki OBJECTED.
A roll call vote was taken on the motion.
IN FAVOR: Guttenberg, Kawasaki, Ortiz, Pruitt, Thompson,
Tilton, Wilson, Gara, Grenn, Foster, Seaton
OPPOSED: None
The MOTION to adopt Amendment Replacement H HSS 18
PASSED (11/0).
4:21:08 PM
Representative Tilton MOVED to ADOPT Amendment H HSS 19
(copy on file):
Public Assistance Administration
H HSS 19 - Decrement
Offered by Representative Tilton
Decrement to Travel from 2017 Actual Levels plus
adjustment for CPI
Vice-Chair Gara OBJECTED for discussion.
Representative Tilton read the amendment (see above). She
reported that the amendment reduced the travel line of
$154,000 by $28,000 leaving the travel line at the FY 17
level and accounting for inflation.
Vice-Chair Gara explained his objection. He reported that
costs were increasing in Public Assistance. The number of
clients were increasing. The state was in the middle of a
recession and the number of public benefit applications
from 2016 to now had increased on a monthly basis by 40
percent from 10,000 to 14,000 per month. The division had a
huge backlog of roughly 20,000 claims for public benefits.
The travel money was used to go out to supervised workers
who were turning over at an alarming rate of about 31
percent per year.
Vice-Chair Gara continued that a 3-year solution was being
proposed in another portion of the budget. Presently, there
was amazing burn-out, travel for supervision, and travel to
work on the continuing problem with the ARIES computer
system. He reported that the proposed cut of $28,900 came
with federal match dollars, which would result in an actual
cut of about $45,000 if the amendment passed. The division
had acted responsibly even with more people on benefits.
The division was approximately $32.0 million below in state
general fund spending than it was in FY 15. The division's
actuals were $1.2 million below what they were in FY 17.
There were 30,000 to 40,000 more people on Medicaid. He
thought it was amazing that the division had kept its
budget $32 million below where it was in FY 15. He
emphasized that the funds were needed.
4:23:38 PM
Representative Wilson wanted to discuss the amendment which
pertained to travel. She asked the sponsor of the amendment
to elaborate about past travel expenses versus what it was
presently. She wondered if the amendment had anything to do
with the ARIES system. She asked for clarification.
Representative Tilton relayed that the actuals in FY 17
were $28,800 in travel and the request was $186,600 - 6
times the cost of the prior year's budget. The description,
per the department, was administrative travel to regional
and national conferences to review changes, provide
analysis, and propose national legislation.
Vice-Chair Gara responded that the budget for the public
assistance administration was $1.2 million below FY 17
actuals. The travel costs that the funds could and would
likely be used for was for travel to work on the problems
with the ARIES system across the state. Travel was
necessary to supervise and train new workers, which was a
constant need within the division. The goal was to have
employees working around the state rather than in one main
office. He reported that if the dollars were removed, they
would come back in a supplemental budget request.
Co-Chair Seaton noted that if funds were not at the
allocation level, funds could be moved between line items.
He thought it was difficult to only discuss on line item.
Representative Wilson wondered why the department put
something in travel when they thought they would need it
somewhere else. She reemphasized the increase of almost 6
times the previous allocation amount. She did not believe
the caseload increases and the issues with ARIES were new
to the department. She wanted to know more accurately where
the money was being spent.
Co-Chair Seaton noted an opioid crisis and there being
several conferences offered on the topic. He was not going
to determine, through the budgeting process, which
conferences department employees could attend. He was
looking at the appropriation level when budgeting rather
than the line items. As long as spending did not exceed the
appropriation amount, he was not concerned.
Representative Ortiz asked if the department was available
to provide further information on the impact of the
amendment.
4:28:24 PM
Ms. O'Brien responded that the travel budget for the Public
Assistance Administration staff was largely for
administrative type travel including supervision, training,
and system development meetings. The department anticipated
things that would happen throughout the year. The
department anticipated that spending would be a certain
amount based on a planning effort. In the past year and the
year prior to that, the department had done a significant
amount of cost containment in travel and hiring. The
containment could be seen in the department's lapsed
balances where the division and the department had taken
extra steps to reduce travel needs. For the FY 19 budget
the division budgeted their travel at the same level as
they had been in prior years anticipating they would be
doing a large amount of work on the ARIES program.
Representative Tilton pointed to the "Other Travel Costs'
line. The request was $73,000 and the actual was $300. She
noted that the travel request was 6 times more overall than
the actual amount spent and 3 times without counting the
match.
Vice-Chair Gara MAINTAINED his OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Pruitt, Thompson, Tilton, Wilson, Grenn
OPPOSED: Kawasaki, Ortiz, Gara, Guttenberg, Seaton, Foster
The MOTION to adopt Amendment H HSS 19 FAILED (5/6).
4:30:56 PM
Vice-Chair Gara MOVED to ADOPT Amendment H HSS 20 (copy on
file):
Public Assistance Field Services
H HSS 20
Pursue Development of a Single
On-line Application for Public Assistance Programs
Offered by Representative Gara
Wordage:
It is the intent of the legislature that the Division
of Public Assistance pursue opportunities to work with
Code for America to develop a single on-line
application for public assistance programs, including
Medicaid, Adult Public Assistance, and the
Supplemental Nutrition and Assistance Program, and
report back to the legislature on its progress by Nov.
15, 2018 and again on November 15, 2019.
Explanation:
Code for America is a national nonprofit that helps
governments and others to build technology to create
healthy, prosperous, and safe communities. They have
worked with more than 100 local governments across the
U.S., including the Municipality of Anchorage. Code
for America has tentatively expressed interest in
donating its services to DHSS to simplify the
application process for public assistance programs.
Representative Wilson OBJECTED for discussion.
Vice-Chair Gara explained that the amendment had come up in
discussions by Representative Johnston and the department.
He reported that Division of Public Assistance had been
hampered by the ARIES system that had not performed as
advertised. The department had fired the contractor. The
goal of the ARIES system had been to have online
applications. An individual could download their
application online, but they could not submit them online.
Therefore, it was not possible to have an online
application system that spoke to the data system allowing
for research to be done to determine a person's benefits.
Vice-Chair Gara continued that Code for America was a non-
profit that helped states looking to combine their
applications, for example. Potentially, Adult Public
Assistance and Medicaid could be combined into one
application. The department would be meeting with Code for
America in April about free services to the state to help
with the applications process. They could likely help with
the applications process. However, there was the issue of
someone applying and whether the system conveyed the
information or whether research would have to be done on a
client. There was some outside hope that Code for America
could help for no cost as well. The intent language
encouraged the department to work with Code for America and
to let the legislature know the outcome of the effort.
Representative Wilson asked if the department would take
the same action without the intent in the amendment. It
sounded like the department was already acting. She asked
if it was the report he wanted to ensure was done and
provided to the legislature.
Vice-Chair Gara relayed that the goal was that reports
would be submitted to the legislature on November 15, 2018
and November 15, 2019. He thought if he asked the
department to supply the reports without the amendment in
place, it would. He also wanted to recognize the work done
by Representative Johnston in subcommittee. She had had
many insightful comments on the issue. She wanted to know
what the efforts were in working with Code for America.
4:34:05 PM
Representative Wilson WITHDREW her OBJECTION.
Representative Kawasaki OBJECTED for discussion.
Representative Kawasaki indicated that assistance programs
such as Medicaid, Adult Public Assistance (APA), ATAP, and
Supplemental Nutrition Assistance Program (SNAP), had
imbedded asset tests that were required. Other types of
public assistance like senior benefits, childcare
assistance, and the Low-Income Home Energy Assistance
Program (LIHEAP) did not require an asset test. He
suggested that if only one form could be used for each, it
should be the simplest one. There might have to be 2 forms
in case a person on senior benefits who did not have to
perform an asset test did not have to enter certain data.
Vice-Chair Gara did not think it would be possible to do
one application for every benefit. Some Medicaid had an
asset test, and some did not.
Representative Kawasaki WITHDREW his OBJECTION.
Representative Pruitt OBJECTED for discussion.
Representative Pruitt highlighted that the committee had
never discussed Code for America. He thought it was
important to discuss their security measures, their track
record, and other things. He wanted to have the information
so that if something went wrong, at least the committee
could say it had vetted the organization.
Vice-Chair Gara replied that Representative Johnston and
the department were aware of Code for America and felt
comfortable with working with the organization. The
question was whether Code for America was going to work for
the State of Alaska for free. He encouraged Representative
Pruitt to write a letter. He restated that the department
had a meeting with Code for America in April.
Representative Pruitt WITHDREW his OBJECTION.
There being NO further OBJECTION, Amendment H HSS 20 was
ADOPTED.
Representative Ortiz asked to move H HSS 21 and H HSS 22
together.
Representative Wilson did not believe the amendments were
that similar.
4:38: 18 PM
Representative Ortiz MOVED to ADOPT Amendment H HSS 21
(copy on file):
Senior and Disabilities Services
Senior and Disabilities Services Administration
H HSS 21
Service Delivery Models
Offered by Representative Ortiz
Wordage:
It is the intent of the legislature that the
Department re-examine and recommend service models for
Alaskan communities with a population of less than
50,000 to meet the needs of disabled and senior
populations in Alaska's smaller communities.
Explanation:
Service delivery models that works in larger
communities do not necessarily work in Alaska's
smaller communities. It is important to reassess
service needs and delivery models to serve individuals
with disabilities in these communities.
Representative Wilson OBJECTED for discussion.
Representative Ortiz explained that the purpose for both
amendments was that he heard that as DHSS had seen cut
backs and reductions in support from the state, it had been
forced to find areas where reductions could be made. Many
of the programs were tied to federal funding. The amendment
addressed an area where he had heard concerns from his
constituents. He relayed there had been reductions in day
habilitation services, which had caused some extreme issues
for the people who had seen the reductions in communities
like his own. He read a portion of the amendment (see
above). He offered that the amendment spoke to the
differences between rural communities versus urban
communities. The solutions found by DHSS might work well
for urban communities but not for rural ones.
Representative Wilson asked for a definition of a
community. Representative Ortiz replied that a community
would be a community with a population of less than 50,000.
Representative Wilson indicated that the City of North Pole
was under 2000 people. The community of North Pole also
qualified based on a population under 50,000. The City of
Fairbanks also fell under the population mark of 50,000.
Fairbanks Borough did not fall under 50,000. It had a
population of about 100,000. She thought the definition of
a community would make it a major project.
Representative Ortiz relayed that the figure of 50,000 was
just an estimate of what would make a community large
enough to receive such things as daycare facilities for
adults. He encouraged a friendly amendment to change the
number.
Representative Wilson was worried about the language
because she thought it presented a divide. She relayed that
in Fairbanks, if a person wanted to have a baby and
intended for their child to go into daycare, they better
get on a list first. There were very few daycares taking
infants because of regulations. She was unclear about a
service delivery model. She was wondering which services
Representative Ortiz was talking about. She thought the
amendment would be significantly expensive depending on how
expansive they would make the intent language.
Representative Ortiz replied that the amendment was
legislative intent language. He was unsure if it would have
major ramifications within the department. Raising the
issue of the difference between rural communities with less
access to services and urban communities. He wanted the
department to look at and consider the issue as a part of
its plan on how to adjust to reductions in funding.
Representative Wilson commented that it was not just
intent. She spoke of intent language regarding
round-a-bouts at Chena Hot Springs, which outlined that
state money could not be spent. As a result of that intent
language, 100 percent federal funding was secured. She
wanted sideboards to the amendment.
4:44:37 PM
Representative Pruitt thought the only community that would
not be looked at was Anchorage. He conveyed that based on
the definition Wasilla, Palmer, and Juneau would qualify.
He expected the departments to take intent language
seriously. His concern was asking the department to
consider every place but Anchorage. He wanted a clearer
definition. He was concerned with the potential costs
related to the amendment.
Representative Kawasaki reported that the City of Fairbanks
had about 35,000 people. The borough, which exercises
health and social service powers had a population of just
under 100,000. He thought the committee was asking the
department to recommend a service model for Alaska
communities. He thought the amendment could be written
better.
Representative Ortiz asked if it would please the committee
if he lowered the population to less than 20,000.
Representative Wilson provided feedback. She thought the
same issue would apply. She opined the amendment would
still apply to many communities which would likely be
costly. She continued that even off the road system there
would be several communities the amendment would apply to.
She thought the task would over-burden the department. She
suggested that the amendment be rolled to the bottom of the
amendments.
Representative Ortiz WITHDREW Amendment H HSS 21.
4:49:43 PM
Representative Ortiz MOVED to ADOPT Amendment H HSS 22
(copy on file):
Senior and Disabilities Services
Senior and Disabilities Services Administration
H HSS 22
Companion Services
Offered by Representative Ortiz
Wordage:
It is the intent of the legislature that the State of
Alaska proceed expeditiously to establish companion
services under Section 1915(c) of the Social Security
Act to compliment and support the services provided
through the Medicare/Medicaid waiver programs.
Explanation:
The Department indicates the process of establishing a
"companion service" category under Section 1915(c) is
lengthy and can stretch from one to two years. With
the reduction in services under the Day Habilitation
program it is vital that the State pursue the
application process aggressively. Families and
communities have been heavily impacted by the 12 hour
per week cap on Day Habilitation services and until
companion services are available to compliment and
support Day Habilitation services, these families
struggle to meet the needs of this vulnerable
population.
Representative Wilson OBJECTED for discussion.
Representative Ortiz read the amendment (see above). He
further explained that the department was forced to reduce
the amount of day habilitation services available down to
12 hours per week for those who qualified. Originally there
had been a soft cap of 18 hours per week. He heard from his
constituents on a regular basis about the impact of the
reduction. He continued that when the change was made, a
soft cap was put into place. A soft cap allowed for a
recipient to be able to apply for a waiver from the soft
caps when their plan of service came up for review.
However, over 1,000 plans had been reviewed and only about
5 waivers had been granted. He thought what had been
proposed as a soft cap turned into a hard cap. People were
left without access to service. The net effect was that
people with disabilities were forced to be at home for much
longer periods with less access to several things.
Representative Ortiz continued that in response, the
department planned to replace or supplement with the
companion services program requiring less money per hour
for certain services. However, he understood that it would
take more than 2 years to implement the companion care
services plan. In the meantime, there were people caught in
the transition of having to adjust to the great reduction
in day habilitation services.
4:52:53 PM
Representative Tilton understood from the subcommittee,
1915(c) Home and Community-Based Services (HCBS) Waiver
system would be going live in May. She thought he was
asking that they proceed expeditiously to establish
services. However, it was her understanding that it was
happening presently.
Co-Chair Seaton invited the department to respond.
Mr. Sherwood responded that the department would likely go
online in May 2018. The new 1915(c) waiver would serve
people with developmental disabilities who would be
eligible for day habilitation. However, the department did
not intend to offer companion services as part of the
waiver, at least initially. The department went with a
subset of the services that were available to individuals
who currently received another waiver for individuals with
developmental disabilities.
4:54:28 PM
Representative Wilson asked why the waiver did not apply to
the developmentally disabled.
Mr. Sherwood answered that the individual service waiver
was developed as an outgrowth of SB 74 which had the
department look at a different option under federal law to
offer home and community-based services. The intention of
the department was to refinance some grant programs
including substantially refinancing the grant program for
community developmental disability services. As the
department worked with a consultant to evaluate the option,
the 1915(i) option, which, unlike waivers, was more of an
open-ended entitlement. The department determined there
were substantial financial risks associated with it. Much
of the refinancing of developmental disability services
provided through the grants could be accomplished by adding
a second waiver, the 1915(c) waiver for people with
developmental disabilities but with a more limited service
package. It did not include out-of-home residential
services such as group home habilitation. The department
decided to move forward with the grant services. The
department did not have a companion service with any of its
current waivers. The department was looking at potentially
adding it to all of the department waivers. It would
possibly replace more professional level services. A
certain level of support for individuals would be provided,
but not in the case of habilitation which focused primarily
on the acquisition and retention of life skills. Rather, it
would provide a level of supervision and support as people
moved throughout their lives. The department was looking to
move forward, but it would involve regulations, amending
department waivers, and making appropriate plans to have
controls in place for managing utilization.
Representative Wilson remembered a prior conversation about
each case being looked at separately because of not wanting
to have someone who was staying in their own home, go to a
full-time facility. She clarified that the department
thought the 1915(c) waiver would work for day habilitation
but found that it would be better to pursue developmental
individual services. She asked if she was correct.
Mr. Sherwood responded in the negative. He clarified that
the original bill had asked the department to look at a
different option, the 1915(i) option for home and
community-based services. It would have served people on
developmental disabilities grants to provide general relief
assistance and some senior grant programs like grants for
adult daycare. As the department looked at the option, it
had less ability to focus on and target individuals with
higher level needs. The department opted to implement a
second waiver for people with developmental disabilities
that would allow it to refinance the developmental
disability grants program.
4:59:38 PM
Representative Wilson asked if there was a savings because
of the waiver that could bring day habilitation services to
the level it was prior to reducing it.
Mr. Sherwood reported that there were savings. By being
able to substantially reduce the grant program, the
department saved about $5 million in general funds which
had already been reduced from the budget as part of SB 74
fiscal note process. The department would not have access
to that money.
Representative Guttenberg mentioned the department limiting
the hours. He had heard from his constituents that the
reduction in day habilitation hours had been a mistake. He
understood that the department was putting another program
in place in the coming May. He wondered what would be
added. He also wondered how the state would get back to
where it needed to be.
Mr. Sherwood responded that the people who were impacted by
the reduction in hours for day habilitation services were
not going to be affected by the new waiver. The people that
would be affected by the new waiver were people currently
receiving services through a separate grant program.
Nothing about the new waiver would impact the people who
had seen a reduction in their day habilitation services.
The department was looking at companion services as a way
to offer a less expensive alternative to providing some
level of support but not the same level of habilitative
services. He suggested that in the waivers there were 3
types of services individuals could receive including
residential habilitation where they receive services in
their home; supportive employment, which allowed them to
receive habilitative services where they worked; and day
habilitation where they received services in their
community. The reduction applied to one of these three
options. It was a soft cap in that there was not an
absolute hard limit. However, it was a firmer cap than what
people were led to expect.
Co-Chair Seaton relayed that the committee had additional
comments. Therefore, he would adjourn the meeting and
continue the discussion on the amendment during tomorrow
morning's meeting at 8:30 a.m.
HB 285 was HEARD and HELD in committee for further
consideration.
HB 286 was HEARD and HELD in committee for further
consideration.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 286 DOA Public Defender Letter to HFIN - flattened.pdf |
HFIN 3/6/2018 1:00:00 PM |
HB 286 |
| HB 286 HB 285 Amendments with Actions as of 3-6-18.pdf |
HFIN 3/6/2018 1:00:00 PM |
HB 285 HB 286 |