Legislature(2017 - 2018)ADAMS ROOM 519
02/21/2018 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB321 | |
| HB176 | |
| HB96 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 96 | TELECONFERENCED | |
| += | SB 97 | TELECONFERENCED | |
| += | HB 176 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 321 | TELECONFERENCED | |
HOUSE BILL NO. 321
"An Act making supplemental appropriations and other
appropriations; making an appropriation to capitalize
a fund; amending appropriations; and providing for an
effective date."
1:35:38 PM
Co-Chair Foster MOVED to ADOPT the proposed committee
substitute for HB 321, Work Draft 30-GH2781\O
(Wallace/Martin, 2/20/18).
Representative Wilson OBJECTED for discussion.
JOAN BROWN, STAFF, REPRESENTATIVE PAUL SEATON, explained
the changes in the work draft. She read from a prepared
statement:
The Administration included supplemental requests in
the operating and capital budget bills released on
December 15th. The Administration's stand-alone
supplemental bill was introduced as HB 321 on January
31st. OMB described the December 15th supplementals
when they presented their budget overview on January
18th, the supplemental bill requests on February 1st
and then went through the supplemental amendments last
Friday, February 16th.
The four finance co-chairs, with the assistance of the
Legislative Finance Division, have been analyzing the
supplemental requests with the goal of having a "fast
track" supplemental bill. It's been several years
since a separate supplemental bill has been adopted,
but it used to be the norm. There are a couple of
reasons why earlier passage of at least some of the
supplemental requests is a good idea:
1. Agencies that are requesting supplementals
know their final current fiscal year budget more
timely, alleviating uncertainty for the program
managers and for those that benefit from the
programs.
2. Shortening the list of supplementals that
get added to the capital budget at the end of the
legislative session (or special session) reduces
the size of the actual capital budget bill making
it easier to track the items that should be in
the bill. When many items are being added or
deleted in various bills and between the bodies,
items can be inadvertently dropped. That happened
last year. Line 21 adds a supplemental that was
inadvertently dropped last year. This Fast Track
eliminates 9 pages out of the capital budget
bill. This allows Legal Services to get a bill
out more quickly.
Requests that didn't make it into the "fast track"
just mean that at least one finance co-chair had a
concern or question that was not answered timely or
satisfactorily. Any remaining supplemental requests
will be considered for inclusion in the capital budget
bill. Tomorrow the other finance committee is also
introducing an identical version of the "Fast Track"
supplemental.
1:39:36 PM
Ms. Brown continued to read from her prepared introductory
remarks:
In addition to the O version of HB 321, you have
before you:
1. The legal-sized spreadsheet of all the
supplemental requests.
a. The lines that are shaded green in the first
column means those items are included in the Fast
Track supplemental. So all of the items on pages
1 through 7 ? are included. You'll find the
Supplemental Bill total on page 6 of the
spreadsheet: $49.5 million of Unrestricted
General Fund, $5.1 million of Designated General
Funds, and $13.1 million of Other Funds for a
total of $67.7 million.
b. The remaining page and a half are the
accounting system ratifications for prior years,
which don't add to the bill total. (Ratifications
are entries adding authorization to zero out
accounting system errors. The funds were already
spent in the prior years.)
c. The second "Bill" column indicates in which
bill the supplemental was requested.
d. The middle columns of the spreadsheet:
Department through Fund Source are unchanged from
the OMB version of the spreadsheet.
e. On the right side of the spreadsheet, the
yellow highlighted Modification column notes
what, if any, changes the Finance Committee
chairs have made to the original requests.
i. For example, on lines 2-4, these items are
now in the numbers section instead of language.
ii. On line 8 there's a new supplemental request
from the legislature for $121.3 General
Fund/Program Receipts related to the extension of
the Anchorage Wells Fargo lease in the Benson
Blvd.
iii. There are a variety of other changes noted
in this column as well.
f. On the far right side of the spreadsheet,
the yellow highlighted Legislative Finance
Division or LFD Notes column includes explanatory
notes.
2. You also have a 3-page Legislative Finance
operating supplemental report with red boxes on it.
The numbers in the boxes correspond to the line
numbers on the legal-sized spreadsheet.
3. A Multi-year Agency Summary report that shows the
Fast Track supplementals by agency and whether they
are operating or capital.
a. There's only one capital item included: the
$8,125.0 Statutory Designated Program Receipts
Volkswagen settlement. It is described on line
14 of the legal-sized spreadsheet.
b. You may notice that the total on this report
is less than the $67.7 million I just mentioned.
That's because on the Agency Summary Report, the
Fund Transfers are not included in the Statewide
Total. However, the Fund Transfers are shown on
the report and if one does the math, the totals
do match.
[Secretary Note: All the documents Ms. Brown referred
to are on file.]
1:42:44 PM
Co-Chair Seaton recognized that Representative Kawasaki and
Representative Guttenberg had joined the meeting.
Representative Pruitt asked if the $30 million increment
was switching the fund source from the Power Cost
Equalization (PCE) Endowment Fund to the Alaska
Comprehensive Health Insurance Fund (ACHI).
DAVID TEAL, DIRECTOR, LEGISLATIVE FINANCE DIVISION, replied
in the affirmative. He detailed that the governor's
original budget funded the Community Assistance Fund (CA)
from PCE in FY 2018, which informed communities of the
amount of their FY 2019 distribution but left the FY 2020
amounts unknown. The supplemental CS proposed to use the
reinsurance refund from Premera to ACHI on line 13 of the
spreadsheet ["FY2018 Supplemental Bill"] (copy on file) in
the amount of $25 million. The balance of the ACHI fund was
somewhere between $80 million and $90 million. The purpose
was to allow the PCE earnings to be used in FY 19; the
transaction occurred in the operating budget. The
transaction put the PCE earnings used for community
assistance back on the original track the legislature
intended; prefunding CA rather than using the supplemental
process. The governor's budget disregarded one year's
deposit therefore, in order to save the $30 million PCE
withdraw for FY 19, the ACHI fund source was chosen for FY
18. One-time funding was chosen for the one-time fund
source, which was a reimbursement for reinsurance
overpayment.
1:46:35 PM
Representative Pruitt recalled that the PCE fund earned
$112 million the past year and a formula determined the
amount available to spin off for PCE. Legislation in the
prior year allowed an amount of money above what was
necessary to fund PCE to be used for CA. He asked how the
change impacted the overall value of the fund and the two
distribution calculations. Mr. Teal replied that the
purpose of funding from the ACHI fund was to leave the
value of the PCE fund unaffected. Funding both the FY 18
and FY 19 CA expenditures from the PCE was possible because
the PCE earnings were so high. However, the option reduced
the value of the fund and jeopardized future earnings and
was not favored by the co-chairs.
Representative Wilson pointed to lines 3 and 4 of the FY
2018 Supplemental Bill spreadsheet pertaining to the
Department of Corrections (DOC). She offered that the
offender population trend was leveling. She asked for a
breakdown of SB 91 - Omnibus Crim Law & Procedure;
Corrections [ CHAPTER 1 SLA 17 -03/21/2017] funding for
population management based on how the legislature was
going to "re-disperse moneys into those specific
institutions." Ms. Brown did not have the breakdown on hand
but would follow up. Representative Wilson pointed to line
4 of the spreadsheet [inmate healthcare]. She reported that
she had been unable to determine in subcommittee how the
health needs were being met. The department had sent
several inmates out of state because healthcare was more
affordable. She had received information from DOC but the
breakdown of the $10 million supplemental expenditure was
incomplete. She noted an additional $10 million increase in
the FY 19 budget. She requested more information regarding
the increases in inmate health care.
1:50:00 PM
Representative Wilson WITHDREW her OBJECTION to the
adoption of the work draft.
Co-Chair Seaton OBJECTED for further discussion.
Representative Ortiz pointed to page 5, line 20 and asked
why the transaction was necessary. He was in favor of the
appropriation. Mr. Teal asked for confirmation that he was
referencing the $23.9 million appropriation for the Alaska
Marine Highway System (AMHS). Representative Ortiz replied
in the affirmative. Mr. Teal responded that in the prior
session general fund (GF) money was reduced and offset by
additional spending from the AMHS fund that was authorized
due to a supplemental deposit from a prior year. However,
the deposit occurred at a much lower amount than
anticipated. The AMHS fund ended up short by almost $24
million. The system could not schedule without the funding.
The appropriation was a primary reason for the fast track
supplemental; to ensure the AMHS could maintain operations
and schedules.
1:52:02 PM
Representative Guttenberg pointed to page 5, line 22 of the
spreadsheet [University of Alaska Bargaining Unit
Agreements]. He asked if the legislature still had to
ratify the contract even though the contracts had no
monetary terms requiring supplemental appropriation. Ms.
Brown replied in the affirmative. Representative Guttenberg
pointed to line 37, page 8 item for the Department of
Commerce, Community and Economic Development (DCCED)
[Financial Examiner I/II for Alaska Native Claims
Settlement Act Filings and Support]. He asked if there was
a reason why the second position had not been added to the
original budget. Ms. Brown could not recall the original
issue. Representative Guttenberg pointed to page 13 and
spoke about changing the appropriation and transfers of
funding between the Alaska Gasline Development Corporation
(AGDC) and Alaska LNG Project Fund. He asked whether the
transaction was the authorization. Ms. Brown answered that
if the item was not shaded green in column one it was not
in the supplemental CS. The supplemental items he noted
were presented for a decision in the future.
Co-Chair Seaton WITHDREW his OBJECTION. There being NO
further OBJECTION, Work Draft 30-GH2781\O was ADOPTED.
HB 321 was HEARD and HELD in committee for further
consideration.
Co-Chair Seaton handed the gavel to Co-Chair Foster'
Co-Chair Foster indicated that HB 176 was previously heard
in committee on February 16, 2018.