Legislature(2025 - 2026)BELTZ 105 (TSBldg)
04/16/2025 03:30 PM Senate EDUCATION
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| Audio | Topic |
|---|---|
| Start | |
| SB5 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 5 | TELECONFERENCED | |
SB 5-SCHOOL/UNIVERSITY EMPLOYEE HEALTH INSUR
3:34:55 PM
CHAIR TOBIN announced the consideration of SENATE BILL NO. 5 "An
Act relating to group insurance coverage and self-insurance
coverage for school district employees, employees of the
University of Alaska, and employees of other governmental units
in the state; and providing for an effective date."
3:35:29 PM
SENATOR HUGHES, District M, Alaska State Legislature, Juneau,
Alaska, sponsor of SB 5. She stated that SB 5 is a
straightforward bill previously heard last session, with recent
discussion about amendments on the Senate floor. She explained
that the bill would allow school districts, the University of
Alaska, and interested local governments to opt into the state
health insurance pool (AlaskaCare). She noted several districts
expressed interest this year, believing participation could
result in cost savings, and emphasized support for those
efforts.
SENATOR HUGHES added that her office contacted Matthew Moser at
the National Education Association (NEA). The NEA remains
neutral on the bill, while the Fairbanks district supports it
but was unable to join as invited testimony. She cited an
Institute of Social and Economic Research (ICER) study showing
that over 25 years, health care costs have increased fivefold,
averaging 7.8 percent annually.
SENATOR HUGHES reported that some superintendents estimated 25
to 30 percent of their district budgets go toward health
benefits. She stressed that legislators aim to direct education
funding toward student learning and teacher support, yet up to
45 percent of state funds for education, excluding local
contributions, currently go to health insurance.
SENATOR HUGHES concluded that while the option may not benefit
every district, SB 5 would allow flexibility for those able to
save money through the state pool, ensuring more funding can
support students and educators directly.
3:38:41 PM
CHUOL MUT, Intern, Senator Shelley Hughes, Alaska State
Legislature, Juneau, Alaska, co-presented an introduction of SB
5 and offered the sectional analysis:
[Original punctuation provided.]
SB 5 Sectional Analysis
Section 1 AS 14.08.101 Page 1, Line 5 through Page
2, Line 29 INTERIM ADDRESS: 600 E Railroad Avenue
Wasilla, Alaska 99654 907-376-3725
[email protected] Adds to powers of
regional school boards the power to establish and
maintain school district participation in a policy of
group insurance, selected by the State of Alaska, that
provides medical insurance.
Section 2 AS 14.14.090 Page 2, Line 30 through
Page 4, Line 13 Adds to the duties of a regional
school board the duty, when the board's school
district participates in a policy of group insurance
elected by the State of Alaska that provides medical
insurance, to determine and disperse to district
employees and administrative officers the amounts
necessary to cover the district's portion of the cost
of that participation.
Section 3 AS 14.17.300 Page 4, Line 14 through
Line 27 Allows the Commissioner of Administration to
expend from the public education fund (AS 14.17.300)
to the group health and life benefits fund (AS
39.30.095) a total of $100,000,000 or less as needed
to pay claims submitted by school district employees
who are covered by a policy of self-insurance provided
by the state; and, requires the Commissioner of
Administration to repay the public education fund,
over a period of 10 years, the full amount of the
commissioner's expenditures from the public education
fund.
Section 4 AS 14 Page 4, Line 28 through Page 5,
Line 31 Chapter 27. University and School District
Employee Health Insurance. Sec. 14.27.010
(a) Allows school districts to participate in a
policy of insurance that provides medical insurance
coverage to state employees and school district
employees.
(b) Participating school districts are required to
contribute to the group health and life benefits
fund (AS 39.30.095) based on rates set by the
commissioner of administration.
c) Participating school districts are required to
reimburse the state for procuring excess loss
insurance if the state provides insurance benefits
to school district employees under a self-insurance
policy.
(d) Requires participating school districts to
reimburse, over a period not to exceed 10 years,
the Department of Administration's cost of paying
insurance claims by school district employees for
the first four months. School district employees
are covered by a self-insurance policy provided by
the state of Alaska.
(e) Allows a participating school district to
require its employees to pay some or all of the
money that this bill section would require the
school district to pay to the state.
(f) Defines "school employee" and "school employer"
for purposes of the bill section.
Section 5 AS 14.40.170(b) Page 6, Line 1 through
Line 15 Allows the Board of Regents of the University
of Alaska to establish and maintain university
participation in a policy of group insurance, selected
by the State of Alaska, that provides medical
insurance for university employees.
Section 6 AS 39.30.090(a) Page 6, Line 16 through
Page 8, Line 30 Clarifies that when a participating
governmental unit employee is covered by a group
insurance policy obtained by the Department of
Administration, the employee's spouse and dependent
children are also covered.
Section 7 AS 39.30.090(b)(2) Page 8, Line 31
through Page 9, Line 3 Adds the University of Alaska
to the definition of governmental unit applicable to
section 6 of this bill.
Section 8 AS 39.30.090(b) Page 9, Line 4 through
Line 6 Add the definition of school district to AS
39.30.090, which is amended by section 6 and 7 of the
bill.
Section 9 AS 39.30.091 Page 9, Line 7 through Line
15 Authorizes the Department of Administration to
provide group medical care insurance coverage to
school district employees and employees of other
governmental unit by means of selfinsurance.
Section 10 AS 39.30.091 Page 9, Line 16 through
Line 21 Requires the Department of Administration to
procure excess loss insurance in connection with
providing group medical insurance coverage to
employees of governmental units other than the state,
and allows the department to allocate the cost with
the excess loss insurance across all of those
governmental units.
Section 11 The Uncodified law of the State of Alaska
Page 9, Line 22 through Line 26 Make sections 1- 8
and section 10 of the bill applicable to collective
bargaining agreements and other contracts that become
legally binding on or after the effective date of
those bill sections.
Section 12 The Uncodified Law Page 9, Line 27
through Page 10, Line 5 Require certain self-insured
school districts to transfer the closing balance of
their self-funded insurance reserve account soon after
they enroll in a health care plan administered by the
state, and requires that when transferred by a school
district these amounts will be applied to offset
reimbursements owed by that school district under AS
14.20.127(d), a provision proposed in section 4 the
bill.
Section 13 The Uncodified law of the State of Alaska
Page 10, Line 6 through Line 10 Authorizes the
commissioner of administration to adopt regulations
necessary to implement the changes made by the bill,
to take effect on or after the effective date of the
changes made by the bill.
Section 14 The Uncodified law of the State of Alaska
Page 10, Line 11 Make sections 12 and 13 of the
bill effective immediately, subject to the
restrictions set forth in those bill sections.
Section 15 Page 10, Line 12 Makes the bill's
provisions effective date July 1, 2026, except as
provided in bill section 14.
3:40:02 PM
MR. MUT began a presentation on SB 5 and moved to slide 2, What
Does SB 5 Do. He read the slide:
[Original punctuation provided.]
What Does SB 5 Do?
Provides the option for school districts, the
University of Alaska, and governmental units to
participate in AlaskaCare: the state healthcare
program.
3:40:37 PM
MR. MUT moved to slide 3, What Drives the Cost of Public
Education in Alaska, which shows small schools, Healthcare, and
Energy drive cost in Alaska's public schools.
3:40:50 PM
SENATOR HUGHES moved to slide 4, ISER Research Summary No. 2019-
4. She said the point of sharing the information on slide 4 is
to show that freeing up dollars spent on healthcare could help
budget scenarios for districts and perhaps allow them to offer a
more nationally competitive salary to teachers:
[Original punctuation provided.]
ISER Research Summary No. 2019-4
• "Alaska has the highest per capita healthcare
costs in the US (Passini, Frazier, & Guettabi,
2018), which negatively affects private and
public sectors of our economy. Healthcare costs
are a part of teacher compensation. Alaska
unadjusted per-pupil spending on teacher salaries
is 14th in the nation - but after adjusted to US
cost-of-living, the amount is 23% below the
national average. Similarly, Alaska's unadjusted
per-pupil spending on educator's employee
benefits is 64 percent above the US average - but
after adjusted is only 9 percent above the US
average.
• While the challenge of high healthcare costs is
not unique to education, in a fixed budget
scenario these costs put downward pressure on
wages, making it more difficult for Alaska
districts to offer teachers a nationally
competitive salary.
3:41:22 PM
SENATOR HUGHES moved to slides 5 and 6, Benefits of Health
Insurance Pooling, and stated that economies of scale could help
relieve financial pressure on some school districts and allow
for cost savings. She noted that, based on conversations with
some superintendents, the health care options in the state plan
are more attractive than what many districts currently offer.
She emphasized that these options could benefit districts and
potentially local governments.
SENATOR HUGHES explained that administration of the plan would
shift to the Department of Administration, specifically the
Division of Retirement and Benefits, which could reduce
administrative burdens on school districts and local
governments. She acknowledged that the workload shifts to the
department and underscored the value of easing responsibilities
for districts, especially given the focus on education funding
this year.
3:42:40 PM
SENATOR HUGHES referred to a chart showing that over a five-year
period, Alaska's health care costs rose more sharply than in the
rest of the United States. She pointed out that both the cost
levels and the growth rate of health care spending in Alaska
have consistently exceeded those in the Lower 48.
3:42:58 PM
MR. MUT moved to slide 7, and shared a comparison of costs
saying districts, the university of Alaska, and Local
Governments should decide whether to pool with state healthcare:
[Original punctuation provided.]
Claims and Admin Costs Employer Cost
State of Alaska $2,513/mo State of Alaska $1908/mo
KGBSD $2,730/mo KGBSD $2,475/mo
Mat Su $2,645/mo Mat Su $2,315/mo
3:43:48 PM
SENATOR KIEHL asked for clarification on the slide, specifically
whether "claims and administration costs" include both
administrative expenses and the cost of care. He then requested
a distinction regarding "employer cost" and asked what that
category covers.
3:44:17 PM
SENATOR HUGHES stated that in 2024, the per-person health care
cost in Alaska was $2,513, with the state covering $1,908 and
the remainder paid by the employee. She noted that the Kenai
Peninsula Borough School District found health insurance through
the state to be more affordable. She acknowledged that some
districts, such as Juneau, might currently have better insurance
options, though she said she had not directly discussed that
with the district. She emphasized that each entity should
evaluate and choose what works best for their circumstances.
3:45:18 PM
SENATOR KIEHL asked whether the figure listed under "Claims and
Admin Costs" represents the total premium amount, including both
employer and employee contributions. He clarified that, since
the state operates a self-insured pool, he wanted to confirm if
that number reflects the full cost.
SENATOR HUGHES replied yes. It covers patient care because that
would be the claim paying for the service.
SENATOR KIEHL thanked Senator Hughes for the clarification.
3:46:11 PM
CHAIR TOBIN announced invited testimony on SB 5.
3:46:30 PM
RODNEY DIAL, Mayor, Ketchikan Gateway Borough, Ketchikan,
Alaska, testified by invitation on SB 5, stating that it would
give communities like Ketchikan a potential tool to lower school
district employee healthcare costs and redirect savings toward
education and stable local taxes. He explained that the
Ketchikan Gateway Borough School District faces major budget
challenges, largely due to rapidly rising healthcare expenses.
About 87 percent of the district's budget goes to salaries and
benefits, with healthcare alone projected to increase by 10
percent in the upcoming fiscal year, pushing costs near $9
million, or 20 percent of the total budget. He emphasized that
as a self-insured district, the ability to explore a state-
administered insurance pool under SB 5 could offer financial
relief, especially given the district's rising per-employee
healthcare costs, now exceeding $3,000 per month.
3:49:04 PM
LISA PARADY, Executive Director, Alaska Council of School
Administrators, Juneau, Alaska, testified by invitation on SB 5.
She stated that the Alaska Council of School Administrators
(ACSA), represents school districts and education leaders
statewide. SB 5 is a critical option for addressing rising
healthcare costs. She emphasized that SB 5 is voluntary and
allows districts to opt into a state-administered health plan
without imposing a one-size-fits-all mandate. She noted that
healthcare expenses now exceed 16 percent of many districts'
budgets, diverting funds from student programs, staff
development, and essential services, while double-digit annual
increases outpace education funding and strain districts'
ability to maintain benefits. She added that SB 5 offers access
to larger risk pools, lower costs, regional collaboration, and
respects local decision-making, while also serving as a key
strategy for improving educator recruitment and retention in
Alaska's most underserved areas.
3:53:51 PM
MICHAEL ROBBINS, Superintendent, Ketchikan Gateway Borough
School District, Ketchikan, Alaska, testified by invitation on
SB 5. He stated that SB 5 would allow school districts and the
University of Alaska to voluntarily join a state-administered
health insurance plan, offering choice and financial stability.
He explained that Ketchikan spends over 20 percent of its
general fund on employee healthcare, with healthcare costs
rising unpredictably across the state, with some districts
experiencing annual increases over 20 percent. He emphasized
that such volatility forces difficult trade-offs, including
cutting programs and delaying hires, especially when 92 percent
of Ketchikan's budget goes to salaries and benefits, leaving
only 8 percent for all other needs. He highlighted that SB 5
offers districts a way to reinvest savings into student programs
such as mental health support, career and technical education,
and enrichment opportunities, while maintaining strong benefits
critical for attracting and retaining staff. He supported the
bill's voluntary nature and the 10-year reimbursement period for
transition costs, calling it a practical tool for districts
seeking financial predictability without sacrificing benefit
quality.
3:57:59 PM
KATHERINE GARDNER, Deputy Superintendent, Mat-Su Borough School
District, Palmer, Alaska, testified by invitation on SB 5. She
testified on behalf of the Matanuska-Susitna Borough School
District and school board in strong support of SB 5, stating
that the bill expands employee healthcare options for public
education and provides a necessary alternative amid rising
costs. She noted that Mat-Su spends nearly 15 percent of its
total operating budget on health insurance, with premiums rising
over 40 percent between 2013 and 2023. She called this an
unsustainable trend that restricts investment in instruction,
teacher development, and student programs. She explained that SB
5 offers access to larger risk pools and economies of scale,
which could help control costs, increase competition, and
improve employee coverage. She shared that Mat-Su has already
taken steps by moving away from the Public Education Health
Trust and offering high-deductible plans with health savings
accounts but emphasized that challenges remain and SB 5 would
give districts a valuable tool to pursue long-term fiscal
sustainability and educational quality.
4:01:43 PM
LON GARRISON, Executive Director, Association of Alaska School
Boards, Juneau, Alaska, testified by invitation on SB 5. He
expressed support for SB 5, stating that it would give school
districts, universities, and local governments the option to
participate in pooled group or self-insurance coverage. He noted
that the bill aligns with a legislative priority of the
Association of Alaska School Boards (AASB) to improve teacher
and staff recruitment and retention. He emphasized that rising
healthcare costs have significantly impacted districts,
especially smaller ones with limited enrollment. He explained
that nonprofit, member-owned risk pools operate through
collective funding and risk sharing, allowing districts to
reduce costs, improve plan design, and redirect savings toward
student success and employee support.
4:04:11 PM
HEATHER ARANA, Director, Benefits and Compensation, University
of Alaska Systems, Fairbanks, Alaska, testified by invitation on
SB 5. She expressed appreciation for the opportunity to testify
and stated that the University of Alaska supports SB 5, as it
faces the same rising healthcare costs seen statewide and
nationally. She noted that the university has been working with
the Division of Retirement and Benefits (DRB) for the past five
years to assess the advantages of joining a larger risk pool.
She highlighted that SB 5 brings the university closer to making
such participation a reality and supports optional participation
as a way to expand risk sharing across public sector employees.
She offered to provide additional analysis based on ongoing
discussions with DRB.
CHAIR TOBIN concluded invited testimony and asked if committee
members had questions.
4:06:02 PM
SENATOR BJORKMAN recalled that the Matanuska-Susitna Borough
School District withdrew from the Public Education Health Trust
(PEHT) after extended disputes over access to healthcare and
claims data. The district sought to evaluate other plan options.
He noted that the district now uses a different plan but
understands its premiums may increase by approximately 23
percent next year. He questioned whether leaving the larger PEHT
pool has produced the outcomes the district anticipated.
4:07:18 PM
KATHERINE GARDNER stated that leaving the Public Education
Health Trust (PEHT) has met the district's expectations for two
main reasons. First, both employee and district premiums over
the past two years have been lower than they would have been
under PEHT, even though one of the district's two plans is now
facing a potentially large increase. She explained that she has
access to claims data that fully supports the reason for that
increase, which only affects one plan. Second, she values the
autonomy the district now has, which allows them to explore plan
changes to manage costs and consider future alternatives such as
self-insurance or joining AlaskaCare.
4:08:37 PM
SENATOR BJORKMAN asked whether school districts would be able to
move in and out of the state-administered insurance pool while
maintaining full access to their claims data if SB 5 was adopted
as proposed.
MS. GARDNER stated that she is unsure whether SB 5 guarantees
access to claims data, which could make moving in and out of the
pool challenging. She noted that districts like hers would need
to carefully consider that issue. She added that AlaskaCare's
large pool size and public management offer some confidence in
how funds are handled, but emphasized that access to data will
remain a critical factor in any future decision.
4:09:43 PM
SENATOR KIEHL stated that SB 5 is unclear about whether the
Department of Administration has the authority to approve or
deny a school district's request to join AlaskaCare. He stated
his belief that existing statutes reference the commissioner's
authority to grant approval. He asked what decision standards
guide the Commissioner of the Department of Administration. He
also requested clarification on the overall vision for how SB 5
would function.
4:10:35 PM
SENATOR HUGHES deferred the question.
4:10:56 PM
STEVE RAMOS, Chief Health Administrator, Division of Retirement
and Benefits, Juneau, Alaska, answered questions and offered an
overview of fiscal note OMB 64. He stated that based on his
review of SB 5, the decision appeared to rest entirely with the
plan administrator, the Commissioner of the Department of
Administration. He noted that the commissioner would issue a
written response regarding a district's entry into AlaskaCare.
He stated that the specific regulations or rules guiding that
decision remain unclear to him.
4:11:36 PM
SENATOR KIEHL thanked him for his response. He stated that the
bill sponsor may want to clarify the standards used for
approving entry into AlaskaCare. He expressed concern that a
future commissioner could deny access based on the potential for
increased costs to the pool, which would undermine the bill's
intent. He asked whether school districts or political
subdivisions that join would be part of the same claims and
financial pool as current AlaskaCare members, or if they would
be in a separate pool administered by the same third-party
administrator (TPA) under the division's rules.
4:12:40 PM
SENATOR HUGHES stated that although the intent seems to be for
all members to join a single pool, the Division of Retirement
and Benefits should also respond to the question. She noted the
potential need for clarifying legal language to ensure intent is
accurately reflected in SB 5.
MR. RAMOS stated that the current design of SB 5 does not
clearly determine whether new members would be part of the same
pool. He said it seems logical that without inclusion in the
same pool, achieving savings would be unlikely. He emphasized
that spreading risk across a larger group is necessary to
achieve savings.
4:13:24 PM
SENATOR KIEHL referenced SB 5, Section 10, which addresses
separately apportioning excess loss insurance to the pool of
school district employees without spreading it across state
employees. He questioned how that would function mechanically if
all members were part of the same pool.
4:13:53 PM
MR. RAMOS acknowledged the question as valid and stated that he
does not currently have experience with that scenario. He said
he would need to investigate further and follow up with an
answer.
CHAIR TOBIN asked that he send the information to her office for
dissemination to members.
4:14:23 PM
SENATOR KIEHL asked for elaboration on SB 5, Section 3,
regarding the intended use of the Public Education Fund.
4:14:54 PM
SENATOR HUGHES stated that she would need to review SB 5,
Section 3, and follow up with a response. She apologized for not
being fully familiar with that specific section. She said she
did not want to assume the Public Education Fund would cover
startup costs for the Department of Administration, although she
acknowledged there is a fiscal note addressing those setup
costs.
4:15:24 PM
CHAIR TOBIN stated that she was interested in the question
regarding the use of the Public Education Fund. She noted that
the fund allows for a structured draw for specific education
services and wanted to know if there are any concerns related to
that usage.
4:15:38 PM
SENATOR KIEHL expressed appreciation for the 10-year startup
period and payback structure, recognizing it as a thoughtful
effort to support school districts during the transition into
AlaskaCare. He raised questions about the choice of the Public
Education Fund and the aggregate cap, noting the absence of a
time reference. He cautioned that if larger districts join
early, the $100 million cap could be reached quickly,
potentially limiting access for smaller, rural districts. He
emphasized the need to consider those mechanics to ensure the
approach remains workable, especially for small districts.
SENATOR HUGHES stated that she would welcome the opportunity to
work with his office and acknowledged the expertise of his staff
in helping to address the issue. She added that they had not
received a legal memo indicating any problem with the proposed
use of the fund. However, she suggested it may be a good
question for Legislative Legal.
CHAIR TOBIN stated the House recently had discussions regarding
the use of the fund.
4:17:15 PM
SENATOR BJORKMAN asked whether the department had considered the
impact of adverse selection under SB 5, since the bill would
allow groups to move in and out of the plan. He expressed
concern that groups with high-cost experiences might join
AlaskaCare, and then leave when their costs decrease and savings
become possible. He questioned how this movement would affect
the overall cost to the State of Alaska for AlaskaCare.
4:18:05 PM
MR. RAMOS stated that the department had considered the issue
but did not have a specific answer. He explained that
approximately 150 entities, representing around 37,000
employees, could be affected, and emphasized that determining
the impact requires knowing which specific groups would join
AlaskaCare. He acknowledged that groups bringing higher risk
meaning higher costs than the current membershipwould increase
overall costs, and their later departure could also affect the
plan. He noted that group size and characteristics vary, from
the University of Alaska with 3,000 employees to entities with
as few as 10, and factors such as illness burden and plan design
must also be evaluated.
4:19:50 PM
CHAIR TOBIN stated that some Alaska communities commingle
municipal and local school district employees in a shared health
care pool. She asked whether there had been discussions about
the potential impact if a school district chose to leave that
pooled arrangement, possibly jeopardizing the municipality's
ability to maintain health coverage due to reduced
participation. She inquired if there were any provisions for
more robust dialogue before such decisions are made.
4:20:29 PM
SENATOR HUGHES stated that she had not had those conversations
but noted that, logically, if a school district, which is the
larger group in many local governments, were to leave a shared
health plan, the municipality might either follow or face
increased costs. She suggested that this could create financial
pressure on the remaining group. She offered to make inquiries
to determine whether any districts that support the bill had
discussed this issue.
4:21:25 PM
CHAIR TOBIN stated that most school districts likely have
strong, positive relationships with their local city or borough
governments. However, she noted that in cases where such
relationships do not exist considering protections is important.
4:22:21 PM
CHAIR TOBIN said the committee would discuss SB 5 fiscal notes.
She requested that committee members review the zero fiscal note
from the Department of Education and Early Development (DEED) on
their own. She invited Mr. Ramos to present the fiscal note from
the Division of Retirement and Benefits.
4:22:31 PM
MR. RAMOS stated that in the fiscal note [OMB 64] most claim
processing and handling responsibilities will be managed by
contractors, regardless of the plan type. He explained that the
division's primary needs involve determining eligibility,
processing applications, and funding three additional positions,
which are accounted for in the fiscal note. He noted that as the
number of new employees rises staffing thresholds will require
additional hires to manage the increased workload. He emphasized
that the most significant cost in the fiscal note is $1 million
for programming needed to properly process eligibility files and
transmit them to insurance carriers.
4:25:23 PM
SENATOR KIEHL asked whether the $1 million cost for programming
and actuarial consultants is a recurring annual expense or a
one-time upfront cost that decreases as processes become
established.
MR. RAMOS clarified that the $1 million estimate represents a
worst-case, upfront cost based on the assumption of onboarding
up to 150 groups with 37,000 employees. He explained that the
programming would only be needed once for each group, making it
a one-time expense. He added that if groups enroll gradually
over multiple years, the programming needs and associated costs
would be spread out accordingly.
4:26:49 PM
SENATOR KIEHL said the reason he sought clarification on the
cost is because the fiscal note shows a $1 million cost under
the services line for each of the next six years and questioned
whether that accurately reflects the anticipated need.
MR. RAMOS stated he would update the fiscal note.
4:27:20 PM
SENATOR HUGHES commented that while legislators prefer bills
without fiscal notes, SB 5 does carry a cost to the state. She
emphasized that funding K12 education is a constitutional
obligation, and currently 45 percent of state dollars
appropriated to school districtsexcluding federal and local
fundsgo toward health care benefits. She explained that
investing a million dollars upfront through the Department of
Administration could reduce districts' health care costs,
allowing them to redirect state funding toward student learning
and teacher support. She acknowledged the fiscal impact but
framed it as a strategic investment that indirectly supports
education.
4:28:48 PM
SENATOR BJORKMAN expressed support for the concept but raised
concerns about the optional nature of the plan, warning it could
lead to adverse selection. He explained that entities with high-
cost plan experience may opt in, raising costs for the larger
pool, while those with lower costs may stay out until their
experience worsens, further destabilizing the system. He cited
the Kenai Peninsula Borough School District's failed attempt to
join a larger pool after previously opting out, noting it would
have required a 50 percent initiation fee and raised premiums
for others by nearly 5 percent the first year. He urged the
legislature to engage professionals to design a system that
leverages state dollars effectively and avoids instability
caused by selective participation.
4:31:54 PM
CHAIR TOBIN said the committee would discuss the fiscal note for
the University of Alaska System.
4:32:12 PM
ALESIA KRUCKENBERG, Director, Strategy, Planning and Budget,
University of Alaska Systems, Fairbanks, Alaska, offered an
overview of fiscal note OMB 1296. She said currently it is a
zero fiscal note because SB 5 is not mandatory. To know the
costs to the employer, employee, and the state an analysis would
need to happen.
4:33:07 PM
CHAIR TOBIN opened public testimony on SB 5; finding none, she
closed public testimony.
4:33:36 PM
CHAIR TOBIN held SB 5 in committee.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 5 Version A 04.16.2025.pdf |
SEDC 4/16/2025 3:30:00 PM |
SB 5 |
| SB 5 Sponsor Statement 04.10.2025.pdf |
SEDC 4/16/2025 3:30:00 PM |
SB 5 |
| SB 5 Sectional Analysis 04.16.2025.pdf |
SEDC 4/16/2025 3:30:00 PM |
SB 5 |
| SB 5 Fiscal Note DOA-DRB 04.11.2025.pdf |
SEDC 4/16/2025 3:30:00 PM |
SB 5 |
| SB 5 Fiscal Note EED-SSA 04.11.2025.pdf |
SEDC 4/16/2025 3:30:00 PM |
SB 5 |
| SB 5 Fiscal Note UA-SYSBRA 04.16.2025.pdf |
SEDC 4/16/2025 3:30:00 PM |
SB 5 |
| SB 5 Presentation 04.16.2025.pdf |
SEDC 4/16/2025 3:30:00 PM |
SB 5 |
| SB 5 Testimony - Clayton Holland 04.14.2025.pdf |
SEDC 4/16/2025 3:30:00 PM |
SB 5 |
| SB 5 Testimony - AASB 04.15.2025.pdf |
SEDC 4/16/2025 3:30:00 PM |
SB 4 SB 5 |
| SB 82 Testimony - Received as of 04.16.2025.pdf |
SEDC 4/16/2025 3:30:00 PM |
SB 82 |