Legislature(2021 - 2022)SENATE FINANCE 532
04/20/2021 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB101 | |
| SB25 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 10 | TELECONFERENCED | |
| + | SB 101 | TELECONFERENCED | |
| + | SB 25 | TELECONFERENCED | |
| + | TELECONFERENCED |
SENATE BILL NO. 25
"An Act relating to the establishment and maintenance
of an Internet website providing information on state
government financial transactions and specifying the
information to be made available on the website."
9:24:57 AM
SENATOR BILL WIELECHOWSKI, SPONSOR, introduced the bill.
Senate Bill 25 would create a publicly searchable online
checkbook. The state currently had an excel spreadsheet
that could be downloaded. However, it was extremely
difficult to download and very slow to operate. It was not
intuitive and did not provide much information. It was also
not easily searchable.
Senator Wielechowski continued that all of the things he
mentioned had led to the State of Alaska receiving a grade
of F from groups that monitored access to government
information. In the supporting documents there was a report
from the United States Public Interest Research Group, a
non-partisan organization, which rated states on financial
transparency. The organization had given Alaska an F in 5
out of the previous 6 years. Alaska was currently ranked
49th out of the 50 states in terms of access to the state's
financial information. In the prior spring the Department
of Administration (DOA) removed the state's checkbook from
the website. The information was back online after the most
recent hearing in the Senate State Affairs Committee. The
committee was displeased that the checkbook had been taken
down.
Senator Wielechowski asserted that Alaska was effectively
the least transparent state in the United States when it
came to providing access to government financial
information. The bill was easy to implement, as the
financial information was already collected by the state.
It was simply a matter of someone putting together a
publicly searchable website. He noted that when the website
was taken down, he had his staff build an online checkbook
which took about a day and a half. His staff's version was
not as sophisticated as he would have liked, but the
state's talented IT staff would likely be able to get the
task done with ease. The bill had widespread support. He
had introduced a bill in 2009 that was almost identical
which passed in the Senate but not in the House in the
final days of session. One of the arguments against it was
that it was not needed because the state had already
started doing it once the bill had been proposed. However,
currently it was needed since the administration had taken
it down.
Senator Wielechowski relayed there were a couple of reasons
why he thought the legislation could save the state in the
long run. First, it allowed the public to see where state
money was being spent and suggest efficiencies. He had
heard from businesses and contractors who supported the
bill because it allowed them to see the amounts of their
competitors' contracts which would encourage more
competitive bids to the state and save the state money.
Currently, anyone who wanted information from the state had
to submit a request. In other states where there were more
sophisticated online checkbooks, it saved state resources.
Instead of people having to submit formal requests for
information, they would be able to go online and get the
information themselves. It would reduce the efforts of
state employees having to obtain the information in
response to formal requests. He argued that the bill was a
common-sense piece of legislation and urged members'
support.
Senator Olson wondered what other states did to try to make
an online format more user friendly for looking at the
state's finances.
Senator Wielechowski noted that Ohio was one of the best
states in terms of its access to state financial records
online. He had talked to the department responsible for the
State of Ohio's checkbook online to find out more. He
deferred to his staff to provide additional insight.
9:29:59 AM
NATE GRAHAM, STAFF, SENATOR BILL WIELECHOWSKI, replied that
in Alaska if a member of the public wanted to see the
state's financial transactions, they had to download an
Excel spreadsheet that had 100,000 or more lines of data
and search individually from the downloaded Excel sheet for
the expenses they wanted to see. States like Ohio had a
tool similar to a Google search where a person could type
in a department or a vendor and the expenses would
automatically pop up. Ohio used a system that did not use a
giant Excel spreadsheet. The process was all online and it
was easy to extract the necessary data. He suggested the
search was similar to the one used on Alaska Public Offices
Commission's (APOC) website.
Senator Wilson directed a question to DOA.
9:31:44 AM
HANS ZIGMUND, DIRECTOR, DIVISION OF FINANCE, DEPARTMENT OF
ADMINISTRATION (via teleconference), introduced himself.
Senator Wilson asked about the fiscal note and the new
software upgrade to IRIS which was expected to conclude in
FY 22. It would have to automatically be placed into the
reporting requirement. He wondered if the new upgrade of
IRIS already included a searchability function or whether
it would be an additional cost. It looked like the
additional consulting and development costs were expected
to be $40,400. However, the fiscal note was zero. He
wondered if the costs of the reporting requirement were
already included.
Mr. Zigmund responded that it was an additional fee. The
IRIS upgrade was expected to conclude in January 2022 and
was being paid for with the capital appropriations that had
already been provided to the Division of Finance. The
expense was a separate capability that required a separate
capital expenditure. The monies that were in the online
checkbook bill were for the servers and data visualization
software that the state would be using to overcome some of
the challenges that Senator Wielechowski presented in his
testimony. For example, the current checkbook was not as
visually appealing or as easily searchable as Ohio's.
Mr. Zigmund continued that part of what the department
intended to do was utilize software licenses and servers
through the Office of Information Technology and would be
ongoing operating expenses. There were also development
costs for creating an online checkbook. The complexities of
creating an online checkbook came from a number of
different areas. He explained that when the Division of
Finance was working with the data, they started at a level
below what the public would see. The state had to do mass
data for confidentiality, aggregate confidential payments,
and avoid disclosure of anything that could not be
disclosed. He also noted that conversations with the State
of Ohio also highlighted some of the challenges they
experienced in building their online checkbooks so that
things like child welfare payments and victim restitutions
were not improperly disclosed. The division would be using
additional resources from CGI to help with the development
beyond the cost of the IRIS upgrade.
Senator Wilson wondered whether the vendor in Ohio would be
the same vendor in Alaska.
Mr. Zigmund replied in the negative.
Senator Bishop asked Mr. Graham to walk through the
sectional analysis of the bill.
9:36:11 AM
Mr. Graham reviewed the Sectional Analysis (copy on file):
Section 1
Names the act "the Alaska Online Checkbook Act."
Section 2
Adopts legislative findings and intent:
Subsection (a) establishes that this bill is
intended to allow people identify and discover
state revenue and expenditures.
Subsection (b) requires that this act by
interpreted in favor of disclosure and
transparency.
Subsection (c) finds that state revenue and
expenditures must be accounted for and easily
accessible to the public in order to maintain a
fair and open government.
Subsection (d) adopts intent that the state
should strive to create a user-friendly website
that gives the public access to the state's
financial information in a centralized location.
Section 3
Requires that the Department of Administration to make
the financial transactions of the state and the annual
audit available electronically for use in the public
finance internet website.
Section 4
Creates a new AS 37.05.215.
AS 37.05.215 (a) Requires the Department of
Administration to develop operate and maintain a
searchable, free to the public, website that
provides financial information available from the
central accounting system or the annual financial
report.
AS 37.05.215 (a) (1)-(3) Requires the following
information and transactions to be posted on the
online check book website and monthly state
income including:
? Receipts or deposits by a state agency
into a fund or account established within
the state treasury.
? Proceeds from taxes received, categorized
by source type, including compulsory
contributions imposed by the state for the
purpose of financing services.
? Agency earnings including amounts
collected for sales or services, licenses,
or permits issued, or otherwise received by
an agency.
? Revenue received for the use of state
money or property including interest and
lease payments gifts, donations and federal
receipts and other revenue.
Expenditures including:
? The names and locations of any persons to
whom payment was made.
? The amounts of the expenditures disbursed.
? The type of transaction, by account code,
including the purpose of the expenditure.
? Other information specified by the
department.
The balance of the following state accounts:
? Statutory Budget Reserve.
? Constitutional Budget Reserve.
? Permanent Fund Earnings Reserve Account.
AS 37.05.215 (a) (4)-(7) Requires the following
information be posted on the online check book
website and updated monthly:
The amount deposited into the Permanent Fund from
all mineral lease rentals, royalties, royalty
sale proceeds, federal mineral revenue sharing
payments, and bonuses received by the state.
State revenue and expenditures, summarized by:
General fund revenue sources categorized by
function, department, and account.
Total general fund income compared to
expenditures.
Total assets compared to liabilities at the end
of the fiscal year.
For the preceding 10 years, by fiscal year the
following:
? The number of state employees by
department.
? The number of independent contractors
engaged by the state by department.
? The total long-term debt owed by the
state.
? Total general fund expenditures.
? All general fund payroll by department.
AS 37.05.215 (b) Describes the reporting
requirements for the previous subsection.
AS 37.05.215 (c)(1) Requires that the website
have reference materials to assist the public in
understanding the financial provided on the
website.
AS 37.05.215 (c)(2) Requires the website to
have a feature that allows users to search for
information on the website by keyword and
recipient.
AS 37.05.215 (c)(3) Requires the site to have a
link to the website of the Legislative Audit
Division. The site must also include electronic
copies of information related to state service
procurement contracts, including compensation and
contract length and of information related to
independent contractors engaged by the state, by
state agency, including compensation and contract
length.
AS 37.05.215 (d) Requires the Department of
Revenue and other state agencies that use the
central accounting system to provide information
to the Department of Administration that is
necessary to comply with this act.
AS 37.05.215 (e) Clarifies that this bill will
not require the disclosure of information that is
confidential under state or federal law and
requires that aggregated information be disclosed
if it can properly protect confidentiality
AS 37.05.215 (f) Defines "expenditure,"
"searchable Internet website," and "state
agency."
Section 5
Requires the website to be operating on or before
October 1, 2022.
Section 6
Requires information from the previous fiscal year be
on the website by October 1, 2023 and requires site to
be updated.
Requires the Department of Administration to continue
to make their current Alaska Checkbook Online Internet
website operational until the bill goes into effect.
Transitional Provisions
Requires the Department of Administration to continue
to maintain their current online checkbook, until
section 4 of this act take effect.
9:42:05 AM
Senator Hoffman pointed to page 5, and the definition of
"expenditure." He remarked that at the end of each fiscal
year the State of Alaska had encumbrances that committed to
making payments of substantial amounts. He did not see
encumbrances as a category. He wondered why it had not been
included in the definition of expenditure.
Mr. Graham would have to get back with an answer. There
were a few issues with the expenditure that Senator
Wielechowski was trying to address. For example, a
Permanent Fund Dividend would be included, yet it was not
the intent to list every Alaskan who was paid a PFD in the
checkbook. There were some issues that still needed to be
resolved.
Senator Hoffman noted that it was not a small item, rather
it was huge. Individuals would not see the total amount
until an encumbrance was paid. He suggested that
encumbrances be included in the expenditures to provide
Alaskans a clear picture of committed monies. He provided
an example of building a school. At the halfway mark of a
project $10 million was expended, but $20 million was
appropriated. The appropriation amount was important
information for the public to know about as well as the
amount already expended for the school project. Both pieces
of information were critical for transparency.
Co-Chair Stedman added to the topic of accrual. He thought
it was also significant when looking at the state's
savings. For example, the Constitutional Budget Reserve
(CBR) had encumbrances, and it was nice to know about
available cash balances. He wanted to avoid as much
misinformation as possible.
9:46:10 AM
Co-Chair Bishop asked if the bill sponsor had any anecdotal
or analytical figures regarding the traffic accessing the
checkbook in a given year.
Mr. Graham deferred to Mr. Zigmund.
Mr. Zigmund replied that he would have to research the
answer and get back to the committee.
Senator Wilson asked if the bill sponsor would consider
including the reimbursable service agreements (RSAs). He
was aware of one department having about $17 million of
unbudgeted RSAs. He wondered if it had been a consideration
and why it was excluded.
Mr. Graham agreed to provide the information.
Co-Chair Bishop asked Mr. Graham if he understood the
senator's question.
Mr. Graham replied in the affirmative.
9:48:00 AM
Co-Chair Bishop OPENED public testimony.
RYAN MCKEE, STATE DIRECTOR, AMERICANS FOR PROSPERITY,
WASILLA (via teleconference), testified in support of the
bill. Senate Bill 25 would create a free searchable website
that would provide Alaskans with easy access to detailed
and comprehensive information on state spending. It would
encourage better understanding of state operations and
ultimately reduce waste and ensure that funding was
directed to the state's most important needs. All 50 states
operated websites that made information on state
expenditures and revenue open to the public. However,
compared to other states, Alaska's website was ranked as
one of the worst in the nation. Additionally, the state's
online checkbook website removed all of FY 20 expenses and
has not been updated in nearly a year. Although the state
had an online checkbook, it did not provide any big picture
context about state expenditures versus revenue. The
checkbook codified in law.
Mr. McKee continued that the ability to see how Alaska's
government used public funding was fundamental to
transparency, bolstered public confidence in government,
and promoted fiscal responsibility. Americans For
Prosperity also believed that if the state maintained a
better website, it could save the state time and money.
State employees currently spent time responding to freedom
of information requests for public information that could
and should already be accessible online. It was his hope
that the state and federal government would champion
economic opportunity-focused reforms that allowed Alaskans
to keep more of their hard-earned paychecks and recover
stronger from COVID-19. He encouraged the Senate Finance
Committee to pass the legislation.
9:50:27 AM
PORTIA NOBLE, SELF, ANCHORAGE (via teleconference),
testified in support of the legislation. She was grateful
for Senator Wielechowski's approach to giving Alaskans more
access and transparency. Nearly every state in the nation
had some kind of transparency website including Alaska.
However, some websites were better than others. Alaskans
deserved to know exactly how tax dollars were being spent.
The checkbook site would be a user-friendly tool that would
help Alaskans understand where public dollars were being
used. More importantly, her hope was that the bill would
help elected officials root out wasteful government
spending. Increasing transparency and accountability was
key to restoring trust in government and to not be a
partisan issue. She was grateful that Senator Wielechowski
addressed the concerns of the former commissioner of DOA
regarding the number of independent contractors engaged by
each agency and the total long-term debt owed by the
agencies. She reiterated her support for SB 25.
9:52:10 AM
Co-Chair Bishop CLOSED public testimony.
9:52:13 AM
AT EASE
9:52:55 AM
RECONVENED
Co-Chair Bishop stated that there were many outstanding
questions that needed addressing before an amendment
deadline could be set. He discussed the following day's
agenda.
SB 25 was HEARD and HELD in committee for further
consideration.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 101 Sponsor Statement-CACFA 3.26.21.pdf |
SFIN 4/20/2021 9:00:00 AM SRES 3/29/2021 3:30:00 PM |
SB 101 |
| SB 101 White Paper Differneces ANILCA Program & CACFA.pdf |
HRES 5/14/2021 1:00:00 PM SFIN 4/20/2021 9:00:00 AM SRES 3/29/2021 3:30:00 PM |
SB 101 |
| SB 101 Letter of Support Stan Leaphart 3.28.21.pdf |
HRES 5/14/2021 1:00:00 PM SFIN 4/20/2021 9:00:00 AM SRES 3/29/2021 3:30:00 PM |
SB 101 |
| SB 101 Letter of Support SCI AK 3.28.21.pdf |
HRES 5/14/2021 1:00:00 PM SFIN 4/20/2021 9:00:00 AM SRES 3/29/2021 3:30:00 PM |
SB 101 |
| SB 101 Letter of Support Charlie Lean 3.28.21.pdf |
HRES 5/14/2021 1:00:00 PM SFIN 4/20/2021 9:00:00 AM SRES 3/29/2021 3:30:00 PM |
SB 101 |
| SB 101 Support DOC Newsminer Editorial 11.15.2020.pdf |
HRES 5/14/2021 1:00:00 PM SFIN 4/20/2021 9:00:00 AM SRES 3/29/2021 3:30:00 PM |
SB 101 |
| SB 101 AOC Letter of Support 3.26.21.pdf |
HRES 5/14/2021 1:00:00 PM SFIN 4/20/2021 9:00:00 AM SRES 3/29/2021 3:30:00 PM |
SB 101 |
| SB101 Letter of Support CAP 4.2.21.pdf |
HRES 5/14/2021 1:00:00 PM SFIN 4/20/2021 9:00:00 AM SRES 3/29/2021 3:30:00 PM |
SB 101 |
| SB 101 Letter of Support AMA 4.12.21.pdf |
HRES 5/14/2021 1:00:00 PM SFIN 4/20/2021 9:00:00 AM SRES 4/12/2021 3:30:00 PM |
SB 101 |
| SB 101 LB&A CACFA Audit Report 4.8.2020.pdf |
HRES 5/14/2021 1:00:00 PM SFIN 4/20/2021 9:00:00 AM SRES 3/29/2021 3:30:00 PM |
SB 101 |
| 3 SB 25 Sponsor Statement.pdf |
SFIN 4/20/2021 9:00:00 AM SSTA 2/2/2021 3:30:00 PM |
SB 25 |
| SB 25 Explanation of Changes V.a to V.b.pdf |
SFIN 4/20/2021 9:00:00 AM SFIN 1/24/2022 1:00:00 PM |
SB 25 |
| 6 SB 25 Supporting Doc 2 Historical 10-19 Reports Follow The Money.pdf |
SFIN 4/20/2021 9:00:00 AM SSTA 2/2/2021 3:30:00 PM |
SB 25 |
| 5 SB 25 Supporting Doc 1 Follow the Money 2018 Report.pdf |
SFIN 4/20/2021 9:00:00 AM SSTA 2/2/2021 3:30:00 PM |
SB 25 |
| SB 25 Updated Sectional Version b.pdf |
SFIN 4/20/2021 9:00:00 AM |
SB 25 |
| 7 SB 25 Supporting Doc 3 Online Checkbook Examples.pdf |
SFIN 4/20/2021 9:00:00 AM SSTA 2/2/2021 3:30:00 PM |
SB 25 |
| SB 25 AKPIRG ST AFF testimony.pdf |
SFIN 4/20/2021 9:00:00 AM SFIN 1/24/2022 1:00:00 PM |
SB 25 |
| SB 25 AFP-AK Support Letter_ (002).pdf |
SFIN 4/20/2021 9:00:00 AM SFIN 1/24/2022 1:00:00 PM |
SB 25 |
| SB 25 Responses to SFIN Committee Members re SB 25 Online Checkbook 5.03.21.pdf |
SFIN 4/20/2021 9:00:00 AM SFIN 1/24/2022 1:00:00 PM |
SB 25 |