01/31/2017 03:30 PM Senate STATE AFFAIRS

                                                                                                                                
3:51:20 PM                                                                                                                    
CHAIR DUNLEAVY called  the committee back to  order. He announced                                                               
the consideration  of SB  2. He noted  that public  testimony was                                                               
still open.                                                                                                                     
                                                                                                                                
3:51:50 PM                                                                                                                    
JERRY BURNETT, Deputy Commissioner,  Alaska Department of Revenue                                                               
(DOR),  addressed the  fiscal  note  for SB  2  that indicates  a                                                               
$279,000 operating  cost primarily  for mail.  He added  that the                                                               
amount of  the dividend in  the fiscal  note is $1,030.  He added                                                               
that the  amount of the dividend  would be adjusted to  the total                                                               
appropriation in SB 1.                                                                                                          
                                                                                                                                
He noted that  two issues were not  addressed in SB 2  nor in the                                                               
DOR  fiscal note.  The  Alaska Department  of  Health and  Social                                                               
Services (DHSS)  is not sure  how beneficiaries will  be effected                                                               
and has not brought forward a fiscal note.                                                                                      
                                                                                                                                
He explained  that the second  issue pertained to  the historical                                                               
calculation  for the  felon funds  where the  amount goes  to the                                                               
Department of  Corrections. He detailed that  the calculation for                                                               
felon funds for the $1,022 dividend  in the FY18 budget was $12.4                                                               
million. He  said with  the larger  amount the  calculation would                                                               
have been $25  million. He added that the bill,  as written, does                                                               
not address the supplemental dividend.                                                                                          
                                                                                                                                
He concluded that the next committee  may want to address the two                                                               
issues that he noted.                                                                                                           
                                                                                                                                
CHAIR DUNLEAVY asked Mr. Burnett if he had additional comments.                                                                 
                                                                                                                                
MR. BURNETT  replied that  the appropriation  is contrary  to the                                                               
Governor's  fiscal plan  so everyone  should think  about whether                                                               
that money is needed for  other purposes. The issues he mentioned                                                               
are the only administrative issues.  He added that in response to                                                               
a comment from Chair Dunleavy, there is no intentional delay.                                                                   
                                                                                                                                
CHAIR  DUNLEAVY noted  that  the next  committee  of referral  is                                                               
Senate Finance.                                                                                                                 
                                                                                                                                
SENATOR COGHILL  asked if garnishing the  PFD would be a  part of                                                               
the second issuance, as well.                                                                                                   
                                                                                                                                
MR.  BURNETT  answered  yes  and   noted  the  cost  of  one-time                                                               
garnishment includes 48 hours of programming time.                                                                              
                                                                                                                                
SENATOR COGHILL asked if it was administrative costs.                                                                           
                                                                                                                                
MR. BURNETT replied yes.                                                                                                        
                                                                                                                                
3:57:02 PM                                                                                                                    
CHAIR DUNLEAVY asked if SB 2  is still contrary to the governor's                                                               
fiscal plan.                                                                                                                    
                                                                                                                                
MR.  BURNETT  answered  that  the  budget  documents  before  the                                                               
Legislature are consistent with not paying the second dividend.                                                                 
                                                                                                                                
CHAIR DUNLEAVY noted  that there was a majority vote  in both the                                                               
House and the  Senate for the appropriation last  session and the                                                               
governor  vetoed  it.  SB  2   is  an  attempt  to  restore  that                                                               
appropriation.                                                                                                                  
                                                                                                                                
SENATOR  COGHILL asked  about  contingency  language and  whether                                                               
there is  legal precedent for  passing a bill that  is contingent                                                               
upon another one.                                                                                                               
                                                                                                                                
CHAIR DUNLEAVY deferred to his staff to answer.                                                                                 
                                                                                                                                
3:59:08 PM                                                                                                                    
GINA RITACCO, Staff, Senator  Dunleavy, Alaska State Legislature,                                                               
Juneau, Alaska,  explained that  SB 1  is the  appropriation bill                                                               
for $683,234,813  for a dividend of  about $1,030 for 2016.  SB 2                                                               
is a  directive to DOR to  issue the check immediately.  SB 2 has                                                               
an  effective date  of May  1, 2017,  for both  bills to  pass in                                                               
order to  use FY18 funds. SB  2 also has a  section that provides                                                               
if SB 1 fails, SB 2 is not enacted.                                                                                             
                                                                                                                                
SENATOR COGHILL confirmed that Ms.  Ritacco's review answered his                                                               
previous question.                                                                                                              
                                                                                                                                
MS. RITACCO  explained that the  reason SB  2 directs DOR  to pay                                                               
immediately is  that if it  didn't the appropriation would  go in                                                               
with next  year's dividend,  rather than  as a  supplemental, and                                                               
end up adjusting 2017's dividend amount.                                                                                        
                                                                                                                                
4:01:25 PM                                                                                                                    
SENATOR GIESSEL moved  to report SB 2, version  A, from committee                                                               
with individual recommendations and attached fiscal notes.                                                                      
                                                                                                                                
4:01:36 PM                                                                                                                    
CHAIR DUNLEAVY announced  that without objection, SB  2 moved out                                                               
of Senate State Affairs Standing Committee.