05/30/2015 01:14 PM Senate FINANCE

CS FOR HOUSE BILL NO. 2001(FIN) am                                                                                            
                                                                                                                                
     "An  Act making  appropriations for  the operating  and                                                                    
     loan  program  expenses  of state  government  and  for                                                                    
     certain   programs;  making   appropriations  for   the                                                                    
     operating   expenses   of    the   state's   integrated                                                                    
     comprehensive   mental  health   program;  capitalizing                                                                    
     funds    and     repealing    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."                                                                         
                                                                                                                                
1:14:47 PM                                                                                                                    
                                                                                                                                
JAMES ARMSTRONG, STAFF, SENATOR  PETE KELLY, stated the bill                                                                    
would  fully-fund the  K-12 foundation  formula, at  roughly                                                                    
$16.5  million for  than HB  72. The  bargaining units  were                                                                    
restored and  funded. He  stated that  page 64  approved the                                                                    
language,  and  Sections  4 through  6  listed  the  funding                                                                    
sources. The  draft had  a provision  for pay  increases for                                                                    
non-covered employees  contingent on the governor's  veto of                                                                    
HB 176,  which was $11.8  million. There was  an unallocated                                                                    
reduction on page  25, lines 24 through 25  of $29.8 million                                                                    
that   corresponded  with   the   covered  and   non-covered                                                                    
increases. If a supermajority vote  was not obtained then K-                                                                    
12 foundation funds  would be prorated at the  same level in                                                                    
HB 72;  all of the  bargaining units would be  rejected, and                                                                    
the cost  of living pay  increases would not be  funded; and                                                                    
there would be an unallocated  reduction of $9.8 million. He                                                                    
explained  that  there  was  an  amendment  that  added  $15                                                                    
million in CBR  funds for the following  items: $700,000 for                                                                    
Parents as  Teachers; $2 million Pre-K  grants; $2.5 million                                                                    
for Office  of Children's  Services (OCS)  front-line social                                                                    
workers;  $2.8  million  for the  senior  benefits  program;                                                                    
$1.750  million for  the Alaska  Marine  Highway System;  $5                                                                    
million  for  the University  of  Alaska;  and $250,000  for                                                                    
public broadcasting.  The amendment  also added  $681,700 in                                                                    
federal  funds,  and limited  the  FY  15  CBR access  to  a                                                                    
maximum of $500 million.                                                                                                        
                                                                                                                                
Co-Chair Kelly  remarked that  the governor  did not  have a                                                                    
fully-funded budget,  which was  the reason for  the current                                                                    
special  session. He  wondered  if the  current  bill was  a                                                                    
fully-funded budget.                                                                                                            
                                                                                                                                
1:18:17 PM                                                                                                                    
                                                                                                                                
DAVID TEAL, DIRECTOR,  LEGISLATIVE FINANCE DIVISION, replied                                                                    
that the current version did  not fully fund the budget. The                                                                    
FY 16  supermajority vote  gave access  to $15  million, and                                                                    
was the maximum that could be withdrawn from the CBR.                                                                           
                                                                                                                                
Co-Chair  Kelly wondered  what was  needed from  the savings                                                                    
account  to fully  fund the  budget. Mr.  Teal replied  that                                                                    
approximately  $3 billion  was  required to  fully fund  the                                                                    
budget.                                                                                                                         
                                                                                                                                
Co-Chair Kelly  stated that the  budget was $3  billion, and                                                                    
only $15 million would be available.                                                                                            
                                                                                                                                
1:19:05 PM                                                                                                                    
RECESSED