Legislature(2005 - 2006)SENATE FINANCE 532
05/03/2005 09:00 AM Senate FINANCE
| Audio | Topic |
|---|---|
| Start | |
| SB46 | |
| HB187 | |
| SB102 | |
| SB22 | |
| SB192 | |
| HB178 | |
| SB125 | |
| SB46 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 187 | TELECONFERENCED | |
| += | SB 46 | TELECONFERENCED | |
| += | SB 102 | TELECONFERENCED | |
| *+ | SB 192 | TELECONFERENCED | |
| + | SB 22 | TELECONFERENCED | |
| + | SB 78 | TELECONFERENCED | |
| + | SB 125 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| = | HB 178 | ||
MINUTES
SENATE FINANCE COMMITTEE
May 3, 2005
9:15 a.m.
CALL TO ORDER
Co-Chair Green convened the meeting at approximately 9:15:51 AM.
PRESENT
Senator Lyda Green, Co-Chair
Senator Gary Wilken, Co-Chair
Senator Fred Dyson
Senator Bert Stedman
Senator Lyman Hoffman
Senator Donny Olson
Also Attending: GINGER BLAISDELL, Staff to Senator Lyda Green; PETE
ECKLUND, Staff to Representative Kevin Meyer; ROB CARPENTER, Fiscal
Analysis, Legislative Finance Division; DOUG LETCH, Staff to
Senator Gary Stevens; JOE BALASH, Staff to Senator Gene Therriault
and Aide to the Legislative Budget & Audit Committee; RICHARD
BENAVIDES, Staff to Senator Bettye Davis; EDDY JEANS, Director,
Division of School Finance, Department of Education and Early
Development; RICHARD MANDSAGER, M.D., Department of Health and
Social Services; MATT ROBUS, Director, Division of Wildlife
Conservation, Department of Fish and Game; KELLY KEPLER, Director,
Division of Sport Fish, Department of Fish and Game
Attending via Teleconference: From an Offnet Site: JERRY FULLER,
Medicaid Director, Office of Program Review, Department of Health
and Social Services; KIM FLOYD, Representative, Mat-Su School
District; Mat-Su: TOM RYAN; From Anchorage: TORA GERRICK
SUMMARY INFORMATION
SB 46-APPROP: CAPITAL BUDGET
The Committee heard from Committee staff and the Department of Fish
and Game. A committee substitute was adopted and to it 36
amendments were considered with 30 adopted and three amended and
adopted. The bill was held in Committee.
HB 187-AMERADA HESS INCOME; CAPITAL INCOME FUND
The Committee heard from the bill's sponsor and the Division of
Legislative Finance. The bill reported from Committee.
SB 102-COASTAL MANAGEMENT PROGRAMS
The Committee heard from the bill's sponsor as well as staff from
the office of Senator Gene Therriault. A committee substitute and
three amendments were adopted, and the bill reported from
Committee.
SB 22-MEDICAID COVERAGE FOR BIRTHING CENTERS
The Committee heard from the bill's sponsor, the Department of
Health and Social Services, and took public testimony. A committee
substitute was adopted and the bill reported from Committee.
SB 192-SCHOOL CONSTRUCTION BOND REIMBURSEMENT
The Committee heard from the bill's sponsor, the Department of
Education and Early Development, and took public testimony. The
bill was held in Committee.
HB 178-SPECIAL REQUEST LICENSE PLATES
The bill reported from Committee.
SB 125-LICENSING MEDICAL OR CARE FACILITIES
The bill heard from the Department of Health and Social Services,
and the bill reported from Committee.
SB 78-SENIOR CARE PROGRAM
The bill was scheduled but not heard.
SENATE BILL NO. 46
"An Act making capital appropriations and appropriations to
capitalize funds; and providing for an effective date."
This bill had previously been heard in the Senate Finance
Committee.
9:16:44 AM
Co-Chair Green noted that a revised work draft, Version 24-GS1074\Y
was before the Committee for consideration. Version "Y" contains a
few changes as a result of the Committee discussion on the previous
work draft, Version 24-GS1074\G. Ms. Blaisdell, Co-Chair Green's
capital budget aide, would explain the changes to the Committee.
Amendments to Version "Y" would be addressed when the Committee
reconvened at approximately 4:00 P.M. this afternoon. To that
point, she asked that Committee Members provide amendments by 3:00
P.M.
GINGER BLAISDELL, Staff to Senator Green, verified that the Version
"Y" work draft had been distributed.
Co-Chair Wilken moved to adopt committee substitute Version "Y" as
the working document.
Co-Chair Green objected for explanation.
Ms. Blaisdell explained the changes contained in Version "Y". Pages
one through 74 include the individual agency requests for projects
that would be typically included in a Capital Budget. Governor
Frank Murkowski originally submitted the majority of those
requests. She pointed out that a large component of the bill is
dedicated to named recipients grants and grants to communities. The
majority of those are requests of Legislators. Some of those
requests might be separately included under specific Departments
such as the Department of Transportation and Public Facilities.
Ms. Blaisdell characterized pages 75 through 90 as being "the
contingent section" of the bill that would finance SB 155 education
projects. That section would be unfunded were SB 155 adopted;
however, were SB 155 to fail, its education projects would be
funded from the general fund.
Ms. Blaisdell stated that approximately $60,000,000 of Amerada Hess
interest earnings would be appropriated to the projects identified
in Sec. 6 on page 91. There is also an additional section
pertaining to the Capital Income Account. However, she noted that
that Account must be established prior to enacting the language
included in Sec. 6.
Co-Chair Green noted that the Capital Income Account, which is
addressed in SB 187, would be heard during today's Committee
meeting.
Ms. Blaisdell continued that Sec. 7 on page 91 would provide the
authorization for Legislative Budget & Audit and other general
provisions that are typically included in Capital Appropriation
Budgets.
9:20:21 AM
Ms. Blaisdell stated that language in Sec. 13 pages 93 through 106
would address the supplemental appropriations that were originally
presented in SB 97.
9:20:54 AM
Ms. Blaisdell identified that language in Sec. 13 differs from that
of the previous version of the bill. Sections 13(f) and 13(g) on
page 93 would provide two appropriations to the Division of
Retirement and Benefits, Department of Administration, for work
relating to SB 141.
9:21:27 AM
Ms. Blaisdell informed the Committee that due to a drafting error,
a correction must be made in Sec. 20, page 96, lines 17 and 18. The
language reading "the sum of $34,563,300 is appropriated from the
general fund to the Alaska Debt Retirement Fund" should be deleted
from the bill.
Ms. Blaisdell noted that language referring to the Alaska Gas
Pipeline appropriations is located on page 21 of the bill. That
language would mirror the language contained in the previous work
draft.
Ms. Blaisdell noted that language in Sec. 35, subsection (d), page
106, lines 12 through 14, pertaining to the Expenditures by the
Department of Commerce, Community and Economic Development for the
ratification of the Qualified Trade Association contract, differs
from the language in the previous work draft.
Ms. Blaisdell stated that Sec. 36, pages 106 through 119, would
begin the reappropriation language in the bill. Any appropriations
that might be lapsing would be addressed in this section.
9:23:35 AM
Ms. Blaisdell noted that Sec. 52 pages 119 through 122, beginning
with the Department of Administration, would also address
reappropriations. This language is identical to the language that
was forwarded in SB 97, the supplemental bill.
Ms. Blaisdell continued that Sections 60 and 61, page 122, would
pertain to the provisions of the Capital Income Fund. A number of
calls and emails were received "regarding the necessity of having"
these sections in the bill. Were the Capital Income Fund bill
adopted, this provision must be included, as absent it, existing
language would mandate that the funds go to Permanent Fund rather
than the Capital Income Account.
9:24:51 AM
Co-Chair Green understood therefore that this language would be
"null and void" were SB 187 to fail.
Ms. Blaisdell concurred. This concluded the explanation of the
committee substitute.
Senator Hoffman asked for assistance in locating the agency
requests for $825,000 for the Bethel Courthouse; the $233,900
Department of Health and Social Services request for the security
system for the Bethel Youth Facility; the one million dollar
Department of Commerce, Community and Economic Development request
for the Bethel Learning Center; and the one million dollar federal
receipt request for the Department of Natural Resources coastal
wetlands grant. He asked whether these or any other agency requests
might have been excluded in this version of the bill.
9:26:53 AM
Ms. Blaisdell responded that the Governor had originally proposed
the use of Amerada Hess bonds as the funding mechanism for the
Bethel Courthouse project. Due to the fact that the Legislature has
not passed a bond bill, efforts were made to identify other fund
sources to support as many of the Amerada Hess funded projects as
possible. No funds to support the Bethel Courthouse project were
identified. She stated that further review of the funding relating
to the Department of Health and Social Services request for
enhanced security for the Bethel Youth facility would be required.
Senator Hoffman pointed out that the security needs of the Bethel
Youth Facility were identified by the Department of Health and
Social Services as being its number one priority.
9:27:38 AM
Ms. Blaisdell stated that further review of that funding request
would be undertaken.
Ms. Blaisdell communicated that no funds were identified to replace
the Amerada Hess funding to support the Bethel Learning Center.
Senator Hoffman clarified that the original funding for the Bethel
Learning Center was general funds
Ms. Blaisdell responded therefore, that the decision was made to
not fund that facility. Choices had to be made in light of limited
general funds.
9:27:58 AM
Senator Hoffman asked regarding the decision to exclude the one
million dollars federal receipts request for the Department of
Natural Resources coastal wetlands grant.
Ms. Blaisdell responded that, while no State general funds would be
required, three similar federally funded projects were removed from
the capital budget. The decision to remove those projects was a
policy call, as further understanding pertaining to the use of the
land and the impact that accepting those federal funds might incur
on the Alaska Department of Natural Resources and its management of
that land would be desired.
Senator Hoffman requested that, at some future point in time, the
Department of Natural Resources could testify in regards to that
concern. He ascertained that absent this endeavor, more problems
could occur in these areas; specifically in regards to land that is
held privately. Acquiring land, with the assistance of these
federal grants, could assist in averting problems being experienced
with privately held lands, for example, with the Chignik Dip Net
Fishery.
9:30:07 AM
Co-Chair Green asked Senator Hoffman whether he was a member of the
Committee's Natural Resources subcommittee.
Senator Hoffman replied in the negative.
9:30:19 AM
Co-Chair Green recalled that that subcommittee had raised questions
regarding "the line of command" and other procedures associated
with this funding. Further information would be sought.
Senator Hoffman noted that, based upon the forthcoming information,
an associated amendment might be developed. He requested that the
Department of Natural Resources be present to respond to questions
in this regard.
Co-Chair Green reminded the Committee that amendments would be
considered during the afternoon hearing on this bill.
9:31:22 AM
Ms. Blaisdell requested that amendments be submitted in written
form rather than through telephonic or email communication.
Co-Chair Green asked Ms. Blaisdell whether the written amendments
should be provided prior to the 4:00 PM hearing.
Ms. Blaisdell responded that that would be welcome, time
permitting.
Senator Hoffman remarked that he was targeting noon as his
amendment submittal deadline.
[NOTE: the Version "Y" committee substitute was formally adopted
after the following At Ease.]
Co-Chair Green ordered the bill HELD in Committee.
AT EASE 9:32:40 AM / 9:36:06 AM
SENATE BILL NO. 46
"An Act making capital appropriations and appropriations to
capitalize funds; and providing for an effective date."
The bill was again before the Committee.
Co-Chair Green removed her objection to adopting the committee
substitute.
There being no further objection, Committee Substitute Version "Y"
was adopted as the working document.
The bill was HELD in Committee.
[NOTE: Additional action on this bill was conducted later in the
meeting. See Time Stamp 5:00:22 PM.]
9:36:22 AM
CS FOR HOUSE BILL NO. 187(FIN)(efd fld)
"An Act relating to money deposited into the Alaska permanent
fund as a result of the settlement of State v. Amerada Hess;
relating to the Alaska capital income fund and to deposits of
income from State v. Amerada Hess settlement money into the
Alaska capital income fund."
This was the first hearing for this bill in the Senate Finance
Committee.
PETE ECKLUND, Staff to Representative Kevin Meyer, the bill's
sponsor on behalf of Governor Frank Murkowski, explained that this
bill would establish the Alaska Capital Income Fund "within the
General Fund and would authorize the deposit into that fund of
earnings received ? from the Amerada Hess lawsuit." The Amerada
Hess (AH) Settlement was the end result of a 1982 lawsuit the State
filed against oil and gas companies. At the time, "both State and
federal judges expressed concerns about the capacity of Alaskan
judges and juries to participate in the case on an impartial basis
in light of the fact that earnings on that portion of any recovery
in the case would be deposited into the Permanent Fund and be used
to pay Permanent Fund Dividends to all Alaskan juries and judges."
This led to the enactment of Alaska Statute (AS) 37.13.145(d) that
required the interest earned on that lawsuit's settlement money to
be deposited into the principal of the Permanent Fund. Furthermore,
it directed that no earnings derived from that money could be used
to fund Permanent Fund Dividends.
Mr. Ecklund stated that this action eliminated the impartiality
concern regarding the Permanent Fund Dividend (the Dividend)
amount. Although the AH case was settled, there remains the
possibility that it could be reopened or subject to arbitration.
Approximately $424,000,000, including earnings and inflation
proofing, is contained within an AH subaccount in the Permanent
Fund. This bill would propose to retain the AH subaccount at the
$424,000,000 level, but to move money that would be contributed to
inflation proof the subaccount into another portion of the
Permanent Fund principal.
Mr. Ecklund stated that this bill would authorize the earnings on
the AH principal, which is estimated to be $25,000,000 to
$30,000,000 annually, to be deposited into the new Alaska Capital
Income Fund (ACIF). Money deposited into the ACIF could be utilized
to support "any valid public purpose".
Mr. Ecklund noted that the 2006 Capital Budget bill, SB 46, would
include provisions to utilize approximately $60,000,000 "of these
earnings" to support capital projects.
Mr. Ecklund assured the Committee that this endeavor would not
impact the calculation of the Dividend "and is neutral on the
dollar amount of each Alaskan's Dividend".
9:39:03 AM
In response to a question from Senator Dyson, Mr. Ecklund restated
the fact that "this legislation is neutral on the dividend"; it has
no impact on either the calculation of the Dividend or the amount
of each Dividend check.
9:39:14 AM
Co-Chair Wilken, referencing the chart titled "Current System"
[copy on file) provided by the sponsor, asked the reason the
decision was made to establish the ACIF instead of specifying that
the money be utilized for the debt reimbursement fund.
Mr. Ecklund responded that the Committee could alter the proposal
to specify that the earnings from the ACIF be utilized to support
the debt retirement fund.
9:39:45 AM
Mr. Ecklund stated that the decision not to do that at this time
was based on the fact that "the debt retirement fund is a sweepable
fund". There would be no sweepablity concern were the earnings
appropriated to support capital projects.
9:40:00 AM
Co-Chair Green understood that the language in this bill would not
prohibit using the earnings for debt retirement.
Mr. Ecklund affirmed. The money "could be used for any valid public
purpose." Once the money is deposited into the ACIF, it could be
used for such things as debt retirement, capital projects,
operating budgets, and future bond obligations.
Co-Chair Wilken asked for confirmation that the funds in the ACIF
would be non-sweepable.
Mr. Ecklund clarified that the ACIF would be sweepable, however, as
proposed in the capital budget bill, the money deposited into the
ACIF could be utilized to fund capital projects in the capital
budget.
Co-Chair Green understood therefore, that in order to prevent the
funds from being sweepable, they must be identified as the funding
mechanism in the capital budget, for instance.
Mr. Ecklund explained that, "when the money is appropriated from
the Alaska Income Fund to capital projects, those capital projects
are then non-sweepable".
Co-Chair Green understood therefore, that when ACIF money "is used
in a capital project or for debt reimbursement, and is paid out,
it's not sweepable".
Mr. Ecklund clarified that any balance in the debt retirement fund
would be sweepable. On the other hand, "capital projects that have
been appropriated are non-sweepable".
9:41:35 AM
Senator Stedman asked regarding "the mechanics of sweepability" and
whether ACIF could be structured to prohibit its funds from being
swept. In addition, he asked how the AH earnings would be
calculated.
9:42:18 AM
Mr. Ecklund stated that "most funds are sweepable". The FY 06
capital budget would propose "to expend the money that flows into
the" ACIF for capital projects, as, once that money is appropriated
for a capital project, that capital project would not be subject to
the sweep. He reiterated that most funds are sweepable, and that
the "very few exceptions" to that would include the new education
fund that was created this year and the Power Cost Equalization
(PCE) Endowment Fund.
Senator Stedman asked whether this fund could be protected from the
sweep.
Mr. Ecklund responded that "the Department of Administration is the
entity that makes" the determination as to which funds would be
sweepable. A multitude of standards and calculations are involved
in the endeavor. He deferred to the Department of Administration in
this regard.
Senator Stedman asked regarding the calculation that would
determine how much money would be deposited into the ACIF.
9:44:24 AM
Mr. Ecklund replied that a representative of the Alaska Permanent
Fund Corporation, Department of Revenue could best answer that
question; however, he understood that "the earnings on this
subaccount would be calculated the same way as the earnings of the
rest of the Permanent Fund".
Senator Stedman asked whether "any smoothing mechanism" would be
incorporated or whether an annual calculation would be
automatically moved into the account. He surmised that the
calculation would be conducted at the conclusion of each fiscal
year, as that would provide the information to the Governor in time
to incorporate it into his budget proposal that is due by December
15th of each year.
Mr. Ecklund confirmed that the funding transfer would not occur
until the end of the fiscal year. The amount could be estimated
earlier.
Co-Chair Green asked whether it would be possible to calculate this
year's amount based on last year's actual performance. That would
assist in removing the estimation factor.
Mr. Ecklund supported estimating the amount rather than basing it
on last year's performance; the amount would be easier to pinpoint
as the end of the fiscal year nears. Approximately $30,000,000 has
been the recent historical range.
Co-Chair Green concluded therefore that the range of estimation, at
this point, is pretty narrow; there might be a deviation range of
$2,000,000 or $3,000,0000 from the actual amount. She questioned
"whether the forecasting could be that close".
Mr. Ecklund affirmed that it could.
9:46:39 AM
Senator Stedman ascertained that this process would differ from
that of estimating oil prices, which are based on such things as
volume and price. When "operating within the portfolio confines of
the Permanent Fund, it depends on their buying and selling, profit
taking or losses, and then dividend income". He asked why, for
budgetary purposes, a one-year lag time had not been proposed. That
would allow any money that might remain in the ACIF to be utilized
rather than swept. Were the amount based on the prior year, it, in
its entirety, could be appropriated.
9:48:09 AM
Mr. Ecklund responded that the Governor's capital budget proposal
included $340 million of AH bonding. "It appears that that is not
going to happen" and different sources were identified with which
to fund the capital budget. This proposal is one area that the
House of Representatives accepted.
Senator Stedman rephrased his question. The question was not in
regards to "the mechanics" utilized this year; it "is more of a
policy decision" as to whether there might be the desire to "put
forth mechanisms within the budgetary process to get a higher
predictability of the revenue stream that we are going to be
working with". Imbedding a one-year delay on this proposal would
provide exact figures as opposed to dealing with fluctuating market
conditions and other influences. Doing so would provide "a cleaner
budgetary cycle".
9:50:30 AM
Co-Chair Green asked whether the bill might contain "that
retroactivity", as she noted that Sec. 4, page two lines 27 through
30 of the bill specifies that Sections 1-3 of this bill are
retroactive to July 1, 2004. Therefore, half of the year would be
"a look-back".
Mr. Ecklund replied that, "the bill does contain a retroactivity
clause that would allow the FY 05 earnings to be used in the FY 06
capital budget".
Co-Chair Green understood therefore that the FY 05 amount would be
an "actual" amount.
Mr. Ecklund stated that it would be "very close" to being actual.
Co-Chair Green understood that were $60,000,000 allocated to FY 06
capital projects through this process, the Legislature would be
able to review the actual FY 05 fiscal year amount, and, were the
actual amount to be $2,000,000 less than anticipated and
appropriated, they would be able to utilize a mechanism to "repair"
that funding shortfall issue. Either a project would not be
furthered or it might be addressed through a supplemental request.
The latter would not be preferred. She stated that some flexibility
might be available.
9:52:44 AM
Co-Chair Green voiced uncertainty as to whether a one-year look-
back had been discussed. She stated that the interest would remain
in the AH account until withdrawn to fund a project.
9:53:28 AM
Mr. Ecklund remarked that the earnings would flow into the capital
income fund, and from there, they would flow to whatever
appropriation the Legislature had specified, such as the capital
projects proposed in the Governor's FY 06 capital budget. Were
sufficient funds unavailable to fund the entirety of the projects
specified for FY 06, a supplemental request could be provided. In
addition, ACIF FY 07 deposits could be used to fund previously
authorized projects. There would be methods to fully fund a capital
project in the FY 06 budget.
Co-Chair Green expressed therefore that "the shortfall" could be
corrected.
9:54:37 AM
Senator Stedman understood "the backfill mechanism" options.
However, "it's a policy call" as the Legislature could fund
projects with funds from the year 2010. The question is whether "we
want" to develop a budget based on an estimate of projected funds
subject to financial market volatility, with "the potential" to
backfill the allocation "or do we want to work with a number
certain". He stated that it would be easier to develop a budget
with a "number certain".
9:55:46 AM
Co-Chair Green asked whether the legislation would require that the
entirety of the interest earnings deposited into the ACIF must be
utilized.
Mr. Ecklund responded in the negative, the amount "would be subject
to appropriation".
Co-Chair Green asked whether it might be possible for the "number
certain" approach, as suggested by Senator Stedman, to encounter an
under-funding situation.
Mr. Ecklund affirmed that the Legislature could specify an amount
of $100,000,000, and only $20,000,000 might be earned.
9:56:35 AM
In response to a question from Co-Chair Green, Senator Stedman
voiced that he had no further comments. He had made his point.
Senator Dyson asked to language in the Sponsor's Statement [copy on
file] that professes that ending the inflation proofing of the AH
principal would "maintain a static balance in the AH principal". To
that point, he asked whether "any unrealized gains as the result of
the growth of the value of what ever instruments that money is
invested in" would remain in the AH principal account.
9:57:49 AM
Mr. Ecklund responded that the current $424,000,000 Amerada Hess
principal balance is the static amount being referenced. He was
unsure as to how the account would be affected by unrealized gains
or losses. A representative of the Alaska Permanent Fund
Corporation would best respond to the question.
Senator Dyson expressed that the reference to "maintaining a static
balance" should not prohibit the account from growing and
appreciating due to inflation proofing and "prudent investments
over time".
Mr. Ecklund explained "the current practice with the Amerada Hess
subaccount" by stating that the account consists of its earnings
and an inflation-proofing amount, as determined by the Permanent
Fund Corporation. Once the earnings are determined, the inflation-
proofing amount is subtracted from the earnings amount, and the
earnings balance is deposited into the subaccount. This is required
by Statute, as none of the subaccount's earnings could be used in
the calculation of the Dividend. Therefore, the subaccount has
experienced growth by both its earnings and the inflation proofing.
Mr. Ecklund stated that this bill "would freeze the principal
amount for accounting purposes at $424,000,000. The inflation
proofing amount that is applicable to the $424,000,000" would be
deposited into the other portion of the Permanent Fund principal
rather than into the AH subaccount.
Senator Dyson clarified that his question pertained to "the value"
of the AHS rather than to its earnings or the inflation-proofing
calculations. Continuing, he commented that the fund might
appreciate due to its investments; therefore, he was asking for
assurance that the increasing value of the fund that might result
from its own investments would not removed from the account "to be
spent".
Mr. Ecklund assured that the fund's "unrealized gains and
unrealized losses are not included in the calculation of
principal".
Senator Dyson acknowledged.
[Co-Chair Wilken assumed chair of the meeting.]
10:01:50 AM
Senator Stedman asked the reason that the State would take an asset
at, for example, the $424,000,000 level and not inflation-proof it.
That would serve to erode the level at, for example, three-percent
a year. Inflation-proofing the account "would not affect the rest
of the Permanent Fund anyway because this is a separate
[indiscernible] entity." Halting the inflation-proofing of the AH
subaccount and instead depositing that money into the Permanent
Fund would serve to over-inflate an already over-inflated account,
and would serve to reduce the purchasing power of the AH subaccount
over time. Every year the account "would go backwards". He could
not "understand the conceptual long-range goal here".
10:03:20 AM
Mr. Ecklund stated that the House of Representatives had discussed
inflation-proofing the sub-account. The Governor's proposal had not
included inflation-proofing the subaccount. The House decided that
in an effort to not diminish the total value of the principal of
the Permanent Fund, the subaccount would be included in the amount
upon which the total inflation proofing calculation would be
calculated. The question is whether the desire would be to grow the
subaccount, which could not be used for dividends, or, as proposed,
to spin off money to be used for any valid public purpose. That
would be a policy call.
Senator Stedman warned that a short-range view of the issue could
be "easily captivating". The Governor presented a concept that has
been altered. The long-range ramifications of the proposal should
be considered.
[NOTE: Co-Chair Green resumed Chair of the Committee.]
10:04:44 AM
Senator Stedman avowed that a slow erosion of the subaccount's
purchasing power would not be desired. Inflation-proofing the
account would not have any affect, as the inflation dollars are
already being calculated, and therefore, instead of crediting the
inflation-proofing into the Permanent Fund, which is already
inflation proofed, the money should be credited to the principal of
the AH subaccount to, "at least, keep the purchasing power constant
over time". Inflation-proofing this account would be an easy fix.
He warned that it is "conceptually easy to walk away from inflation
proofing, but, absent this endeavor, there would be "substantially
less capital available to us" in ten years.
10:06:00 AM
Senator Hoffman ascertained therefore that the question would be
whether to continue the buying power of the AH subaccount or to
enhance the calculation of the Dividend, by crediting the
inflation-proofing money into the Permanent Fund corpus rather than
into the AH subaccount.
Senator Stedman responded that the answer to that question would
depend on whom you ask. Numerous people would be concerned about
protecting the Permanent Fund and their Dividend.
Senator Stedman stated that the AH money "today ? is a virtual
subaccount of the Alaska Permanent Fund and has never had an affect
on the Dividend calculations". Were the desire to redirect the
earnings from the AH settlement, which is an "entity that does the
State no good at all other than a growing pot of money", in a
similar manner to how the State uses the earnings of the Permanent
Fund, while continuing to inflation proof the AH subaccount, would
"at least" hold "its purchase power constant over time". He did not
anticipate this being an issue to most of the people in the State.
Senator Dyson viewed an investment that does not exceed the rate of
inflation as "a lousy investment". "What we have been calling
inflation proofing is just kind of supplemental income to increase
the principal." Therefore, his question would be to the reason that
the State should inflation proof investments as opposed to just
making wise investments that ought to, traditionally, double the
CPI [consumer price index]."
10:08:26 AM
Co-Chair Green asked Rob Carpenter of the Division of Legislative
Finance to explain, among other things, how the amount of interest
earned on the AH Settlement would be calculated under this
legislation.
ROB CARPENTER, Fiscal Analyst, Division of Legislative Finance,
understood that some of the Committee's concerns revolve around the
issues of how not inflation proofing the AH subaccount would affect
it, and "that the income stream would be very flat because the
principal amount would not change". "The principal idea behind" the
current AHS process "is to avoid a change in the actual amount of
the Dividend", as no part of the AH subaccount is factored into the
Dividend calculation. "Therefore, any inflation-proofing of the AMS
portion will reduce future Dividends".
Co-Chair Wilken understood that Senator Stedman's desire would be
to, rather than contributing, for example, the entire eight percent
earnings, or $32,000,000, on the approximate $400,000,000
subaccount balance into the ACIF to support public purposes, three
percent of that amount would be retained to inflation-proof the AH
subaccount and the five-percent balance, or $20,000,000 would be
provided to the ACIF. Such action would continue to maintain the
purchasing power of the AH subaccount. Senator Stedman has
identified the need for there to be a policy call regarding whether
the AH subaccount should be a static account in terms of dollars or
in purchasing power.
10:11:23 AM
Senator Stedman responded that Co-Chair Wilken's interpretation is
"very close" to his intent. The desire would be that in ten years,
the equivalent purchasing power would be available "to work for
us".
Co-Chair Wilken concluded therefore, that the discussion has
returned to Senator Dyson's question regarding the definition of
static: static in terms of purchasing power or static in terms of
dollars.
Mr. Ecklund stated that the House had discussed this issue. "In
rough numbers", inflation proofing "the AH subaccount with its own
earnings" would provide a payout of approximately $21,000,000
rather than the full $30,000,000 to support public purposes. The
effort being undertaken "was to fund as many capital projects as
possible" using as many funding sources as possible, including
utilizing the money that might be provided by this legislation.
This proposal could be adopted and revisited in the future.
10:12:43 AM
Senator Dyson communicated his difficulty in "integrating the
answers" that have been provided. It would appear that the
$400,000,000 plus money would appreciate in value, and have
increasing purchasing power and increased earnings without being
inflation proofed.
10:13:27 AM
Mr. Carpenter reviewed the manner in which the Permanent Fund
currently works. The AH, the entire ERA (Earnings Reserve Account),
and the principal are all invested through the Permanent Fund's
asset allocation. They have both "an unrealized and a realized
earnings flow. The realized earnings stream is their statutory net
minus the Am Hess which then goes back into the Am Hess principal"
along with all its earnings.
Mr. Carpenter continued that this bill would flow the entire
realized earnings associated with the AH subaccount balance of
$425,000,000 into the capital income account. There would be no
inflation proofing. Any realized earnings would be paid out. "There
could be an accounting of unrealized gains associated with that Am
Hess portion, but the way the principal of the Permanent Fund
works, that just a part of the Permanent Fund unrealized
earnings"?. "The principal of the Permanent Fund is just an
accounting notion; whereas the market value of the Permanent Fund
is far in excess."
10:14:42 AM
Senator Dyson asked the reason why the unrealized gains of the
Amerada Hess could not stay with the Amerada Hess principal and
therefore would be an appreciated [indiscernible due to cough]".
10:15:05 AM
Mr. Carpenter stated that this would be possible; "it would be a
matter of structuring it that way".
10:15:16 AM
Co-Chair Green stressed the fact that the bill contains "all 'may'
language". It would not require that this action must be taken each
year. It simply states that the Legislature "may provide money to
the Capital Income Fund".
Mr. Ecklund appreciated that clarification. In response to Senator
Stedman's concerns, he noted that, through the inclusion of the
term "valid public purpose", the Legislature could choose to
reappropriate money in the ACIF back into the Amerada Hess
subaccount.
Co-Chair Green reiterated that this legislation would not establish
"a mandate"; there would not be an automatic process. Any use of
the funds must proceed through the budgetary process. A valid
public purpose must be demonstrated.
Mr. Carpenter commented in regards "to the cash flow from the
Fund". He pointed out that because most capital projects could not
be completed within one year, a shortfall in ACIF funding allocated
for a specific year, might not be that critical. "The revenue would
seem to fall into place in future years."
Co-Chair Green affirmed that "the State generally leaves money on
the table each year"; capital money is not entirely spent each year
as reflected by the fact that the budget contains money from
previous years' allocation that have lapsed. "Some of those
projects never even got started" or were only halfway completed.
Co-Chair Green ordered the bill to be SET ASIDE.
AT EASE 10:17:14 AM / 10:20:52 AM
CS FOR HOUSE BILL NO. 187(FIN)(efd fld)
"An Act relating to money deposited into the Alaska permanent
fund as a result of the settlement of State v. Amerada Hess;
relating to the Alaska capital income fund and to deposits of
income from State v. Amerada Hess settlement money into the
Alaska capital income fund."
The bill was again before the Committee.
Co-Chair Wilken moved to report the bill from Committee with
individual recommendations and accompanying fiscal notes.
There being no objection, CS HB 187(FIN)(efd fld) was REPORTED from
Committee with zero fiscal note #2 dated April 26, 2005 from the
Department of Revenue.
10:22:03 AM
CS FOR SENATE BILL NO. 102(RES)
"An Act relating to an extension for review and approval of
revisions to the Alaska coastal management program; providing
for an effective date by amending the effective date of sec.
45, ch. 24, SLA 2003; and providing for an effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
DOUG LETCH, Staff to Senator Gary Stevens, the bill's sponsor,
testified in support of the forthcoming committee substitute,
Version 24-LS0491\P, that would be being presented by Joe Balash,
staff to Senator Gene Therriault. The Version "P" committee
substitute would further Senator G. Stevens' desire to provide
additional time in which coastal districts could revise their plans
pertaining to Statutes that were implemented two years prior.
Co-Chair Green pointed out that the addition of such language added
ten pages to the previous version of the bill.
Mr. Letch affirmed.
Co-Chair Green observed that those ten pages must contain a lot of
repeat language and very little actual change.
10:22:44 AM
JOE BALASH, Staff to Senator Gene Therriault and Aide to the
Legislative Budget & Audit Committee, stated that committee
substitute, Version 24-LS0491\P would accomplish four things. It
would extend by six months, with one exception, the entirety of the
deadlines specified in HB 191, which had been adopted two years
prior. The proposed six-month extension would be acceptable to the
Governor Frank Murkowski Administration. The exception to the six-
month extension would be the deadline pertaining to "the submission
of the revised local plans": those plans would receive a two-month
extension. This would allow coastal districts to review "what
standards" the federal Office of Ocean and Coastal Resource
Management (OCRM) approved before the coastal districts provided
their final submissions.
Mr. Balash continued that one portion of the ten-page bill increase
would be attributed to the July 1, 2011 termination or "sunset"
component of the program. This date would provide sufficient time
in which "the full implementation" of the changes to the coast
management program could occur. It would also allow time for
federal approval of both the State standards and the local district
plans, as well as "four years of operation of the program". This
timeframe would be similar to what the State provides to the
operation of its boards, commissions, and other regulatory bodies.
Mr. Balash noted that the committee substitute would clarify the
scope of the local district plans and would also "automatically
make changes to the old district plans that the Legislature has
twice indicated in the past three years that it would like to see
made".
10:24:24 AM
Mr. Balash informed the Committee that some changes must be made to
the Version "P" committee substitute. One of those changes would
pertain to language in Sec. 14(b) page 11 lines 10 through 16, as
the original language in AS 46.40.030(b) must be re-incorporated.
In addition the word "may", as denoted on line 12 should be changed
to the word "shall".
Co-Chair Wilken moved to adopt committee substitute Version 24-
LS0491\P as the working document.
There being no objection, Version "P" was ADOPTED as the working
document.
Conceptual Amendment #1: This amendment reinstitutes the original
Statute language into Sec. 14(b) page 11 lines 10 through 16. In
addition, the word "may" in that original language is replaced with
the word "shall". The revised language reads as follows.
(b) In developing enforceable policies in its coastal
management plan under (a) of this section, a coastal resource
district shall meet the requirements of AS 46.40.070 and shall
not duplicate, restate, or incorporate by reference statutes
and administrative regulations adopted by state or federal
agencies.
Senator Dyson moved to adopt Conceptual Amendment #1.
There being no objection, Conceptual Amendment #1 was ADOPTED.
Mr. Balash explained that other changes are requested in regards to
language in Sec. 20 page 12, line 25. Currently, language in
Sections 1 through 13 provides "the clean up language and the
entirety of the references to the Coastal Management Program
consistency determinations in other areas of statute. Sec. 17,
which is a fairly lengthy repeal section is designed to be a sunset
provision that will be renewed in the future". However, no
provision is included in the bill "that links to direction for the"
Division of Legislation Audit "to conduct a sunset review".
Therefore, another conceptual amendment would be requested to
specify "that the Alaska Coastal Management Program be added to AS
44.66.020."
In response to a comment by Co-Chair Green, Mr. Balash clarified
that AS 44.66.010 is a listing of boards and commissions, whereas
AS 44.66.020 is a list of programs that would be eligible for
audits.
Amendment #2: This amendment inserts language into the bill that
adds the Alaska Coastal Zone Management program to AS 44.66.020 in
order to make it audit eligible.
Co-Chair Wilken moved to adopt Conceptual Amendment #2.
There being no objection, Conceptual Amendment #2 was ADOPTED.
Mr. Balash stated that the Governor Frank Murkowski Administration
has requested "that they be granted authority to issue emergency
regulations to implement this Act". Legislative Legal and Research
Services has informed the bill's sponsors that the Department of
Natural Resources "already has the statutory authority necessary,
they simply need to issue a written finding ? that an emergency
exists." However, the Department of Natural Resources has requested
that such language be included in the bill for clarification
purposes.
Amendment #3: This amendment amends uncodified law to add a new
section that reads as follows.
Sec. 4. The uncodified law of the State of Alaska is amended
by adding a new section to read:
EMERGENCY REGULATIONS: The need to adopt regulations
consistent with this Act is declared an emergency, and the
Department of Natural Resources shall proceed to adopt
emergency conforming regulations to implement the provisions
of this Act.
AT EASE 10:30:39 AM / 10:33:35 AM
Co-Chair Wilken moved to adopt Conceptual Amendment #3.
There being no objection, Conceptual Amendment #3 was ADOPTED.
Co-Chair Wilken moved to report the bill, as amended, from
Committee with individual recommendations and accompanying fiscal
notes.
There being no objection, CS SB 102 (FIN) was REPORTED from
Committee with zero fiscal note #2 dated March 8, 2005 from the
Department of Commerce, Community and Economic Development; zero
fiscal note #3 dated March 8, 2005 from the Department of Fish and
Game; zero fiscal note #4 dated March 14, 2005 from the Department
of Environmental Conservation; and new a zero fiscal note dated May
3, 2005 from the Department of Natural Resources.
10:35:15 AM
SENATE BILL NO. 22
"An Act adding birthing centers to the list of health
facilities eligible for payment of medical assistance for
needy persons."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Wilken moved to adopt committee substitute Version 24-
LS0209\F as the working document.
There being no objection, the Version "F" committee substitute was
ADOPTED as the working document.
Co-Chair Green communicated that during this bill's committee
hearing process, the concern was "expressed about the fact that we
have no doubt a very very legitimate cause for support for
midwifery centers and the funding". She noted that the State's
Medicaid program has been based on federal Medicaid standards;
consequently, language has been included in Section 1(B) on page
one, lines ten through twelve of the Version "F" committee
substitute to specify that birthing centers, which are included in
the definition of health facilities, would be eligible for funding
"under the State plan approved under AS 47.07.040 by the United
States Department of Health and Human Services".
10:37:16 AM
RICHARD BENAVIDES, Staff to Senator Bettye Davis, the bill's
sponsor, asked that clarification be provided in regards to whether
the language in Version "F" would require the Department of Health
and Social Services to develop an amendment to the State's plan or
whether the State should wait for a federal determination as to
whether they would fund midwifery centers.
Co-Chair Green voiced being uncertain of the State's procedure in
this regard. The State might be able to develop the required
language. She assumed that the inclusion of midwifery centers would
require federal policies to be rewritten in regards to what would
be deemed acceptable for federal Medicaid "reimbursables". States
must be able to provide input and ask that "various things be added
to the list". She understood that the procedure in this regard has
been a point of ongoing discussion.
Co-Chair Green stressed that it is not the desire of the Finance
Committee to provide "100 percent State Medicaid dollars for
programs that are not currently funded with federal Medicaid." "The
list would be endless and it would be very very difficult." Since
the State "is subject to federal Medicaid with their arbitrary
changes, it's very difficult" for the State, on its own, "to
expand" what the State would pay, even though that use might be
considered "very legitimate" and might save money. That point could
be argued.
10:39:58 AM
Mr. Benavides noted that during the bill's hearing in the Senate
Health, Education, and Social Services Committee that Department of
Health and Social Services had communicated that, were the bill to
pass, the Department would be required to develop an amended plan
in order to have a determination made by the federal government as
to whether they would accept it. Thus the reason for his question
as to whether the Department would be directed to further that
endeavor or whether the federal government would make the
determination as to whether they would expand their coverage. The
committee substitute is unclear in its direction to the Department.
10:40:54 AM
Co-Chair Green stated that input from the Department must be
sought. In the meantime, she voiced the understanding that the
Department did not object to the bill. Therefore, she would not be
surprised were the Department to advance an amendment to the
federal Medicaid program.
Mr. Benavides asked that he be allowed to clarify this further with
the Department and provide their response to the Committee.
Co-Chair Green agreed.
JERRY FULLER, Medicaid Director, Office of Program Review,
Department of Health and Social Services, testified via
teleconference from an offnet site, and stated that, were the bill
approved by the Legislature, the Department would submit language
for federal approval. He concurred with Co-Chair Green's earlier
remarks as to the fluidness of the policies occurring in the
federal Medicaid program.
In response to a question from Co-Chair Green, Mr. Benavides stated
that Mr. Fuller had answered his question.
Co-Chair Green noted her intention to move this bill from
Committee. In the interest of time, she asked teleconferencing
participants to briefly state their position on the bill.
10:42:43 AM
Mr. Fuller informed the Committee that the Department has a neutral
position on this bill
10:43:01 AM
TOM RYAN, testified via teleconference from Mat-Su and communicated
that this bill would provide a "great benefit" to both the State
and its citizens. It would save the State money and provide
Alaskans other health care options.
10:43:29 AM
TORA GERRICK testified via teleconference from Anchorage in support
of the bill.
10:43:45 AM
Senator Dyson, noting that he is one of bill's co-sponsors, thanked
Co-Chair Green for her ability "to see things" that he had missed.
Senator Dyson moved to report the committee substitute from
Committee with individual recommendations and new fiscal note.
Co-Chair Green noted that a new fiscal note would accompany the
bill, as the previous one contained language that was
"problematic".
There being no objection, CS SB 22(FIN) was REPORTED from Committee
with a new zero fiscal note dated April 28, 2005 from the
Department of Health and Social Services.
10:45:10 AM 10:45:54 AM
SENATE BILL NO. 192
"An Act relating to reimbursement of municipal bonds for
school construction; and providing for an effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Green, the bill's sponsor, explained that this bill would
extend the original January 1, 2005 termination date applicable to
the public school construction dept reimbursement program to July
1, 2006. This one and a half year program extension would allow
schools to bond and solicit State assistance in building and
renovating schools. While the Sponsor Statement primarily addressed
school expansion needs in the Mat-Su Valley area, which is the
State's "most problematic area", for over population in its
schools, many school districts have similar expansion needs. Were
the current student growth trend to continue in the Mat-Su area, a
new school would need to be constructed each year. "It is very
difficult to keep up and keep our classrooms, not only in sizes,
but to provide for enough services ? for all our students." She
noted that areas of the Mat-Su Valley that had previously
experienced little growth are now being developed. Other districts
throughout the State are also experiencing construction and
renovation needs.
10:48:45 AM
EDDY JEANS, Director, Division of School Finance, Department of
Education and Early Development, stated that "the Department is
opposed to the extension" of this program "at this time". When the
Legislature authorized the debt reimbursement program in the year
2002, they had included a provision requiring that the Department
provide a report by February 1, 2006 that would review the
effectiveness of the school construction grant and school
construction debt reimbursement program.
Mr. Jeans reminded the Committee that a separate State General
Obligation (GO) bond package was authorized in the year 2002 that
provided funding for Rural schools. The citizens of the State had
approved the school construction debt reimbursement program, and
approximately $728,000,000 in school construction projects have
been authorized throughout the State. The Department is requesting
that it be provided time to review the resulting financial impacts
on the State and develop a report that would convey to Legislators
what the anticipated annual debt would be under this program.
$84,000,000 in debt expenses would be included in the FY 06 budget
with the anticipation for that number increasing were additional
bonds sold.
Senator Dyson appreciated the Department's desire to undertake the
study. He asked regarding any specific school construction projects
that could be affected by this legislation.
10:51:22 AM
Mr. Jeans identified that the Mat-Su School District would have
some needs. The Anchorage School district has also identified needs
they would like to present to their voters. The Department would
appreciate being able to review "the effectiveness" of that program
before an extension occurred.
10:51:57 AM
Senator Olson asked whether this bill would affect school
construction in Bush Alaska.
10:52:13 AM
Mr. Jeans clarified that the debt reimbursement program "is only
available to municipal school districts" such as the Northwest
Arctic Borough and the North Slope Borough. Areas such as the Lower
Kuskokwim/Lower Yukon school areas would not be affected by it.
10:52:32 AM
Senator Olson asked therefore for an example of how this
legislation would affect the Northwest Arctic Borough and the North
Slope Borough.
Mr. Jeans responded that those Boroughs could develop a proposal
for local voter approval. A proposal approved by the local voters
would either qualify for the 70-percent or 60-percent
reimbursement. He pointed out that this legislation, like the
legislation that was passed in the year 2002, would not impose "any
limits by region."
10:53:16 AM
Co-Chair Wilken recalled that either a provision in SB 155-APPROP:
SCHOOLS/UNIV/VIROLOGY LAB/MUSEUM or the FY 06 Capital Budget bill,
would allow projects in organized Alaska to be funded at a 70-
percent State/30-percent local funding ratio "under the grant
provision". Therefore, he understood that this legislation would be
required in order to conduct a community vote on local school
projects in, for instance, the Mat-Su Borough or the Fairbanks
North Star Borough.
Mr. Jeans asked for further clarification of the question.
Co-Chair Wilken expressed that a provision of SB 155 or in the
Capital Budget would apply to named projects in organized Alaska.
Those projects would be included in the list of the traditional
70/30 reimbursement funding mechanism. Therefore absent this
legislation, an organized borough would be unable to develop a
proposal for local voter consideration.
10:54:42 AM
Mr. Jeans replied, "that is not correct". The grants specified in
SB 46-BUDGET: CAPITAL & OTHER/ BRF are grant projects through the
Department of Education and Early Development. The projects and
their funding levels as identified in that bill "are the State's
share at 70-percent." The municipality would be responsible for "a
30-percent local match on top of that".
10:55:11 AM
Co-Chair Wilken asked regarding the procedure were the municipality
to desire to fund their 30-percent match with bond money;
specifically whether this legislation would be required in order to
conduct a Statewide vote.
Further Committee discussion in this regard ensued.
In order to clarify the funding mechanism at hand, Mr. Jeans
clarified that there are two different programs. One is grant
program in which "the Legislature lists out the grant projects in
the State's share". AS 14.11.008 specifies the participating share
for that grant program. The program being discussed in this
legislation refers to AS 14.11.100, which is the debt reimbursement
program. Were this legislation adopted, "then a municipality would
take before their voters the entire project, issue bonds for the
entire project, and the State would either reimburse them at 70 or
60 percent, depending on the individual project's legibility." This
funding mechanism "is quite a bit different than the grant
program."
Co-Chair Green opined that the programs "are similar but
different."
Mr. Jeans replied that they "are similar in terms of what the
participating share is."
Co-Chair Green acknowledged.
Mr. Jeans continued that under the grant program, "the State is
providing the 70-percent up front".
Co-Chair Green surmised therefore that the school district would
not be required to expend money and then get reimbursed.
Mr. Jeans affirmed.
10:57:02 AM
Co-Chair Green understood that "the authority to go to bond is
implied in the Capital bill".
10:57:14 AM
Mr. Jeans responded that in the capital bill, municipalities could
bond for their local share. "Municipalities could bond for 100-
percent of a project right now; it would simply not be reimbursable
by the State at any rate."
10:57:30 AM
Co-Chair Wilken therefore, questioned the need to further this
legislation prior to the Department's report being developed, since
$120,000,000 in school construction needs would be included in SB
155 or in the capital budget. He understood that that amount of
money would address districts' needs.
10:57:53 AM
Co-Chair Green responded that those bills would provide less than
one-half of the Mat-Su School District's needs. However, she
allowed that, based on increased enrollment, the Mat-Su District
might be alone in their situation. Other districts might desire
this funding mechanism and might be eligible, depending on what is
passed or offered. Were the capital bill in its current form to
pass, it would provide funding for the next year, but not for the
Mat-Su District's anticipated future needs. Again, she qualified
that the Mat-Su District might be unique in its population growth.
She asked the Department to elaborate on this issue.
10:58:53 AM
Mr. Jeans expressed that the population of "the Mat-Su Borough is
growing at tremendous rate" and its schools "are operating at
capacity". However, some schools in the State are currently
operating at 200 percent capacity.
Co-Chair Green understood therefore that other schools have similar
needs.
Mr. Jeans affirmed.
10:59:21 AM
Senator Hoffman recalled the original legislation as being a "very
contentious issue." The crux of that dialogue is that, while areas
such as the Mat-Su Valley are experiencing tremendous growth, the
Legislature acts on behalf of the whole State. Without Legislative
action, nothing would occur in regards to the unorganized areas of
the State. All areas of the State should benefit from the oil and
gas revenues generated from the North Slope; quality education
opportunities should be provided to children under the age of 17 in
all areas of the State. This was an issue during the debate on the
original legislation. A list for school construction projects has
been developed that amounts to approximately $527,000,000. In the
past, a percentage of schools would be built in Rural areas of the
State. A formula must be developed that would consider the
education needs of the entire State. He suggested that the
Department address this issue in its report. An amendment was
discussed during the development of the original authorization that
addressed this issue.
Senator Hoffman stated that the advent of a Gas Pipeline would
result in more and more school needs throughout the State. This
issue must be discussed and resolved on a long term basis rather
than being "piecemealed" in legislation such as this. The majority
of the Rural projects addressed in the Capital Budget are major
maintenance needs rather than new school construction needs.
11:02:42 AM
Senator Hoffman asked therefore whether the scope of this
legislation could be limited to specifically address the needs of
the Mat-Su Valley.
11:04:01 AM
Co-Chair Green agreed that a "valid discussion" must be had. She
noted that the FY 06 Capital budget is totally different from
previous budgets in regards to its "huge investment Statewide".
11:04:34 AM
Co-Chair Wilken provided an overview of pending school construction
legislation: approximately $260,000,000 would be specified through
either SB 155 or the Capital Budget including $118,000,000 for
school construction and $141,000,000 for major maintenance.
$69,900,000 would be provided to "people that don't pay a nickel
for their schools"; organized Alaska would be provided $72,000,000.
He doubted that a formula could be developed that would be any
fairer as the funding is fairly evenly divided. A formula would be
a matter of importance only when everyone in all parts of the State
contributed equally to education. That should be a consideration.
11:06:22 AM
KIM FLOYD, Representative, Mat-Su School District, testified via
teleconference from an offnet site and voiced appreciation for the
Committee's discussion on this legislation. Continuing, she spoke
to the fact that the Mat-Su District is experiencing "unprecedented
enrollment growth" and is the fastest growing school district in
the State. This growth is projected to continue. State
demographers' projections were incorrect and "have been revised to
reflect reality." Currently all classrooms are overcrowded and
portable classrooms are being utilized. 28 portables in addition to
the current 48 would be required to meet enrollment needs next
year. However, the District has only enough funding to construct
five. While she acknowledged the Department's desire to complete
their report, she characterized the District as being "out of
time". While the District has compiled a 20-year plan that is
updated annually, its construction needs are a "day late and a
dollar short". Voters understand the situation and would "support
critically essential projects". She asked that the Committee
approve the extension of the bond debt reimbursement program. She
also spoke in support of SB 155. The District is considering every
opportunity thought which to address its student growth needs.
Co-Chair Green ordered the bill HELD in Committee.
Co-Chair Green announced that the Committee would reconvene at
approximately 4:00 PM in order to address amendments to SB 46.
Other legislation would also be considered.
RECESS TO CALL OF THE CHAIR 11:10:03 AM / 4:26:40 PM
CS FOR HOUSE BILL NO. 178(STA) am
"An Act relating to special motor vehicle registration plates;
and providing for an effective date."
This was the second hearing for this bill in the Senate Finance
Committee.
Co-Chair Green stated that this legislation would allow the use of
specialty license plates on commercial vehicles. She noted that
during the previous hearing on this bill, there had been a question
in regards to the "correctness" of the fiscal note. To that point,
a new $45,000 fiscal note dated May 2, 2005 from the Department of
Administration has been provided.
Co-Chair Wilken moved to report the bill from Committee with
individual recommendations and accompanying fiscal note.
There being no objection, CS FOR HB 178(STA) am was REPORTED from
Committee with a new $45,000 fiscal note dated May 2, 2005 from the
Department of Administration.
4:28:28 PM
CS FOR SENATE BILL NO. 125(JUD)
"An Act relating to the licensing, regulation, enforcement,
and appeal rights of ambulatory surgical centers, assisted
living homes, child care facilities, child placement agencies,
foster homes, free-standing birth centers, home health
agencies, hospices or agencies providing hospice services or
operating hospice programs, hospitals, intermediate care
facilities for the mentally retarded, maternity homes, nursing
facilities, residential child care facilities, residential
psychiatric treatment centers, runaway shelters, and rural
health clinics; relating to possession of a firearm at
licensed entities and facilities; relating to criminal history
requirements, and a registry, regarding certain licenses,
certifications, approvals, and authorizations by the
Department of Health and Social Services; making conforming
amendments; and providing for an effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Green explained that this legislation would relate to the
licensing, regulation, and reinforcement of medical or care
facilities. She specified that this legislation would have no
fiscal impact, as zero fiscal notes accompany it. Four Committee
Members heard testimony on this bill during its hearings before the
Senate Health, Education, and Social Services (HES) Committee. Due
of an inadvertent oversight on her part, the intent to waive the
bill from Committee had not occurred. Therefore the bill is before
the Committee with the desire that a brief discussion occur.
4:29:03 PM
RICHARD MANDSAGER, M.D., Director, Division of Public Health,
Department of Health and Social Services explained that,
originally, a zero fiscal note from the Department accompanied this
bill. A Department of Law zero fiscal note was subsequently added
to account for a federal grant that would provide for the expenses
the Department of Law might experience in its regulation revision
and review.
Dr. Mandsager stated that this legislation "would bring together"
in a standardized manner the different statutory and regulatory
authorities for the various entities such as hospitals, nursing
homes, hospice, and assisted living homes that the Department
licenses. This legislation would make the process easier for these
entities to manage.
Dr. Mandsager continued that the bill would align background check
processes for employees and entities that provide services to
vulnerable Alaskans. Public and criminal information regarding such
issues as abuse, fraud, neglect, or Medicaid fraud would be
streamlined to develop a measurement to determine which individuals
would be prohibited from working in the affected fields. Were this
bill adopted, one entity would monitor the background checks.
4:30:15 PM
Co-Chair Green spoke to "the consistency" that this legislation
would provide to the different users and providers of services. It
would provide one set of qualifiers as opposed to multiple sets as
is the current mode of operation. In addition, higher standards
would be implemented.
Dr. Mandsager affirmed. He noted that currently, the Department
does not conduct background checks on the entirety of the entities
it might license. In addition, some employers voluntarily conduct
background checks on its employees and others do not. This
legislation would align the same standard to all entities. This
information is included in the Department's "Public Health
Protecting and Promoting The Health of All Alaskans" handout [copy
on file] that is included in Members' bill packets.
4:31:08 PM
Senator Olson asked whether there has been any response from small
clinics or single practitioner in the State in regard to the impact
this legislation might incur on them.
Dr. Mandsager explained that this legislation would only apply to
entities that the Department currently licenses. Therefore single
doctor offices and health aid clinics that the Department does not
currently license would not be affected by this legislation.
Co-Chair Wilken moved to report SB 125 (JUD) from committee with
individual recommendations and accompanying fiscal notes.
There being no objection, SB 125 (JUD) was REPORTED from Committee
with previous zero fiscal note #2 dated February 28, 2005 from the
Department of Health and Social Services and zero fiscal note #3
dated April 12, 2005 from the Department of Law.
AT EASE: 4:32:00 PM / 5:00:22 PM
SENATE BILL NO. 46
"An Act making capital appropriations and appropriations to
capitalize funds; and providing for an effective date."
The bill was heard earlier in the meeting and was held to allow
Committee members to prepare amendments to the Version "Y"
committee substitute.
Amendment #1: This amendment inserts a new Alaska Native Heritage
Center component to the Grants to Named Recipients (AS 37.05.316)
Budget Request Unit (BRU) of the Department of Commerce, Community
and Economic Development on page 3, lines 30 and 31. This amendment
also appropriates $500,000 general funds to the component.
Senator Dyson moved for adoption.
Co-Chair Green objected.
Senator Dyson expounded on the Alaska Native Heritage Center and
its displays depicting "all the major cultural aboriginal groups in
Alaska." The Center is utilized for education purposes of the
history and heritage of Alaska's first people. This funding would
be utilized to upgrade existing exhibits and construct new exhibits
to display artifacts currently held in storage. He understood this
funding had been included in the Governor's FY 06 capital budget
request.
Co-Chair Green maintained her objection.
5:02:13 PM
Senator Olson furthered that the Center has received funding from
private sources and that the funding requested in this amendment is
necessary to complete the project.
Co-Chair Wilken commented that the Center is a benefit. However
when initially funded, the intent was expressed that the facility
would be self-supporting.
A roll call was taken on the motion.
IN FAVOR: Senator Hoffman, Senator Dyson, Senator Hoffman
OPPOSED: Co-Chair Green Co-Chair Wilken, Senator Stedman
ABSENT: Senator Bunde
The motion FAILED (3-3-1)
The amendment FAILED to be adopted.
Amendment #2: This amendment inserts a new Local Boundary
Commission, Chugiak Eagle River Detachment Study (HD [house
district] 17-18) component to the Grants to Named Recipients (AS
37.05.316) BRU of the Department of Commerce, Community and
Economic Development on page 3, lines 30 and 31. This amendment
also appropriates $50,000 general funds to the component.
Senator Dyson moved for adoption.
Co-Chair Green objected.
Senator Dyson explained that the community of Eagle River wished to
organize but need a study conducted to determine whether it would
be economically viable. An analysis was conducted the previous year
but the funding was insufficient to provide a complete assessment.
5:05:21 PM
Co-Chair Green asked the legislators requesting this.
Senator Dyson listed himself, Representative Bill Stoltze, Senator
Con Bunde and Representative Mike Hawker.
Co-Chair Green asked the amount of funding remaining from the
earlier effort.
Senator Dyson answered $25,000.
Co-Chair Green commented against the additional allocation.
A roll call was taken on the motion.
IN FAVOR: Senator Dyson, Senator Hoffman, and Senator Olson
OPPOSED: Senator Stedman, Co-Chair Wilken, and Co-Chair Green
ABSENT: Senator Bunde
The motion FAILED (3-3-1)
The amendment FAILED to be adopted.
5:06:54 PM
Amendment #3: This amendment inserts a new Arctic Winter Games Team
Alaska component to the Grants to Named Recipients (AS 37.05.316)
BRU of the Department of Commerce, Community and Economic
Development on page 3, lines 30 and 31. This amendment also
appropriates $250,000 general funds to the component.
Senator Olson moved for adoption.
Co-Chair Green objected.
Senator Olson described the international competition comprised of
contestants from urban and rural communities.
AT EASE: 5:07:56 PM / 5:08:35 PM
Co-Chair Green noted the two groups seeking funding for the Games.
She asked whether this amendment would provide funding for
preparations to hold the event in Kenai or for expenses associated
with the team representing the State.
Senator Olson answered that this money would support the Alaska
team itself.
Co-Chair Green commented that a request for this purpose had not
been submitted earlier.
Co-Chair Wilken agreed that no representative of the Games had
approached the legislature prior to this. He would not support the
amendment, as more effort should have been made.
A roll call was taken on the motion.
IN FAVOR: Senator Hoffman, Senator Olson, and Senator Dyson
OPPOSED: Co-Chair Wilken, Senator Stedman, and Co-Chair Green
ABSENT: Senator Bunde
The motion FAILED (3-3-1)
The amendment FAILED to be adopted.
Amendment 4A: This amendment inserts a new African American
Historical Society Juneteenth Celebration component to the Grants
to Named Recipients (AS 37.05.316) BRU of the Department of
Commerce, Community and Economic Development on page 3, lines 30
and 31. This amendment also appropriates $30,000 general funds to
the component. Accompanying explanatory language reads as follows.
This would help fund the capital costs for the celebration of
Juneteenth. The grant would provide funding for the tents,
shelters, display units, exhibits, equipment and supplies
necessary to continue their educational objectives during this
public outreach celebration.
This amendment also reduces the appropriation to the Department of
Commerce, Community and Economic Development, Grants to
Municipalities (AS 37.05.315) BRU, Muldoon Road, Tudor Road Sound
Barrier Fence (HD 17-32) component on page 24, lines 3 - 6 from
$600,000 general funds to $590,200 general funds. Accompanying
explanatory language reads as follows.
This project will construct a sound barrier fence between a
major arterial street and local neighborhoods. (Project design
has been funded and construction could occur in 2005.)
Senator Hoffman moved for adoption.
Co-Chair Green objected.
Senator Hoffman explained that the African American Historical
Society hosts the Juneteenth Celebration on the third Saturday in
June to commemorate the abolition of slavery in the United States.
This event has been celebrated in Anchorage for 30 years.
5:12:20 PM
Senator Hoffman continued that the Society exists to promote and
preserve the historical recognition and culture of the African
Americans living in Alaska.
Co-Chair Green maintained her objection.
A roll call was taken on the motion.
IN FAVOR: Senator Hoffman and Senator Olson
OPPOSED: Senator Stedman, Senator Dyson, Co-Chair Wilken, and Co-
Chair Green.
ABSENT: Senator Bunde
The motion FAILED (2-4-1)
The amendment FAILED to be adopted.
5:14:24 PM
Amendment 4B: This amendment inserts a new Russian Jack Elementary
School Computer & Library Book Purchase component to the Grants to
Named Recipients (AS 37.05.316) BRU of the Department of Commerce,
Community and Economic Development on page 3, lines 30 and 31. This
amendment also appropriates $20,000 general funds to the component.
Accompanying explanatory language reads as follows.
This funding would be used to purchase Apple eMacs to replace
older machines, which cannot run today's powerful educational
software. This would also be utilized for the purchase of more
books and materials to upgrade their library collection.
Senator Hoffman moved for adoption and overviewed the explanation
statement.
There being no objection, the amendment was ADOPTED.
AT EASE: 5:14:48 PM / 5:15:07 PM
5:15:43 PM
Amendment #5: This amendment increases the general fund allocation
to the Department of Commerce, Community and Economic Development,
Grants to Named Recipients (AS 37.05.316) BRU, Alaska Siberia
Research Center, Inc. - Alaska Siberia WWII Memorial Park
Construction (HD 7-11) component on page 4, lines 8 - 11 from
$40,000 to $65,000. Accompanying explanatory language reads as
follows.
In the 5/2/05 work draft Version "F" there was $65,000
appropriated to the project which funds the Lend Lease
Memorial Park project.
In the 5/3/05 work draft Version "Y" this funding was reduced
to $40,000 due to a technical drafting error by the
legislative finance division. This amendment simply corrects
this drafting omission.
Co-Chair Wilken moved for adoption.
Co-Chair Green objected for an explanation.
Co-Chair Wilken explained the drafting error this amendment would
correct.
Without further objection, the amendment was ADOPTED.
5:17:01 PM
Amendment #6: This amendment increases the general fund allocation
to the Department of Commerce, Community and Economic Development,
Grants to Named Recipients (AS 37.05.316) BRU, Mary Magdalene Home
Alaska, Inc. - Transitional Housing Program Facilities (HD 17-32)
on page 6 lines 30 - 33 from $250,000 to $263,500.
Senator Dyson moved for adoption.
Co-Chair Green objected for an explanation.
Senator Dyson reminded that when the decision was made to not fund
a separate project, $13,000 remained unallocated. This amendment
would appropriate that amount to the Mary Magdalene Home project.
Co-Chair Green asked if this addition would bring the total funding
to the "discretionary amount" requested.
Senator Dyson replied that it would not, as the $250,000 proposed
appropriation is $50,000 less than requested.
There being no further objection, the amendment was ADOPTED.
5:18:21 PM
Amendment #7: This amendment increases the general fund allocation
to the Department of Commerce, Community and Economic Development,
Grants to Named Recipients (AS 37.05.316) BRU, Midnight Sun
Council, Boy Scouts of America - Boy Scout Food Service component
on page 7 lines 3 - 6 from $40,000 to $60,000. Accompanying
explanatory language reads as follows.
In the 5/2/05 work draft Version "F" there was $80,000
appropriated to the project.
In the 5/3/05 work draft Version "Y" this funding was reduced
to $40,000 due to a technical drafting error by the
legislative finance division. This amendment simply corrects
this drafting omission.
Co-Chair Wilken moved for adoption and outlined the explanatory
statement.
The amendment was ADOPTED without objection.
5:18:57 PM
Amendment #8: This amendment inserts a new Municipality of
Anchorage - Anchorage School District/Eagle River High School
Traffic Control & Turn Lanes (Veterans Memorial Highway) (HD 16-
18,32) component to the Grants to Municipalities (AS 37.05.315) BRU
of the Department of Commerce, Community and Economic Development
on page 8, lines 11 and 12. This amendment also appropriates
$950,000 general funds to the component.
Senator Dyson moved for adoption.
Co-Chair Green objected.
Senator Dyson informed that the allocation for this project should
be to the Department of Transportation and Public Facilities rather
than the Municipality of Anchorage. This project would be necessary
once the high school is constructed, as the current road system
would be "very dangerous".
Co-Chair Green asked the location of the proposed project.
Senator Dyson described the location of the school located in the
election district represented by Senator Bunde.
Co-Chair Green asked if this project could be included in another
project planned for the Veterans' Memorial Highway.
Senator Dyson replied it could not, as the other project is located
north of this location.
5:21:45 PM
Co-Chair Green asked the reason this funding request had not been
submitted earlier.
Senator Dyson attributed the delay to the number of other
Department of Transportation and Public Facilities project funding
requests.
Co-Chair Green removed her objection to the adoption of the
amendment with the understanding that the exact location of the
proposed project is specified in the legislation.
Co-Chair Green offered a friendly amendment to the amendment to
appropriate the funding to the Department of Transportation and
Public Facilities and make necessary conforming changes.
There being no objection from the sponsor, the amendment was
AMENDED.
Without further objection Amendment #8, as amended, was ADOPTED.
AT EASE 5:23:55 PM / 5:24:33 PM
Amendment #9: This amendment inserts a new Bristol Bay Borough
Community Matching Project component to the Grants to
Municipalities (AS 37.05.315) BRU of the Department of Commerce,
Community and Economic Development on page 8, lines 11 and 12. This
amendment also appropriates $150,000 general funds to the
component.
This amendment also increases the general fund appropriation to the
Department of Commerce, Community and Economic Development, Grants
to Municipalities (AS 37.05.315) BRU, City of Unalaska - Boat
Harbor (HD 37) component on page 13 lines 3 and 4 from $2 million
to $4 million.
This amendment also adds a new Togiak/Twin Hills Bridge Feasibility
Study component to the Department of Transportation and Public
Facilities and appropriates $150,000 general funds to the
component.
This amendment also increases the allocation to the Cold Bay Access
Improvements (HD 37) component of the Surface Transportation
Improvements BRU, Department of Transportation and Public
Facilities, on page 58, lines 30 and 31 from $2 million to $2.5
million.
This amendment also increases the general fund allocation to the
Department of Education and Early Development, School Construction
Grant Fund (AS 14.11.005) BRU, Dillingham Middle/High School
construction and renovation - Dillingham City Schools (HD 38)
component on page 83 lines 14 - 17 from $7 million to $9.5 million.
Co-Chair Green moved for adoption.
Co-Chair Green then offered a friendly amendment to the amendment
to change "Bristol Bay Borough Community Matching Project"
component to read "Bristol Bay Borough Community Mapping Project."
This amendment to the amendment also deletes additional $500,000
general fund allocation to the Cold Bay Access Improvements
component.
This amendment to the amendment also adds a new Aleutians East
Borough - Cold Bay Airport Terminal component to the Grants to
Municipalities (AS 37.05.315) BRU, Department of Commerce,
Community and Economic Development and appropriates $500,000
general funds to the component.
AT EASE 5:25:29 PM / 5:26:20 PM
Co-Chair Green continued to outline the friendly amendment to the
amendment.
Without objection the amendment was AMENDED.
Senator Stedman objected to the amended amendment for further
information on the City of Unalaska - Boat Harbor component.
Co-Chair Green informed that upon review, this amount was included
in an earlier committee substitute.
Co-Chair Wilken asked whether the project expansion of the Little
South America Boat Harbor.
Senator Hoffman understood it was.
Co-Chair Green noted the Members have discussed this project
previously.
There being no objection, Amendment #9 as amended was ADOPTED.
5:28:10 PM
Amendment #10: This amendment adds a LKSD - The Peoples Learning
Center component to the Department of Commerce, Community and
Economic Development [BRU not specified] and appropriates $100,000
general funds to the component. Accompanying explanatory language
reads, "Restores the Governor's original capital budget request."
Senator Hoffman moved for adoption.
Senator Hoffman reminded the Committee of the residential technical
education facility located in Bethel. The amount of secured funds
for this project total $15 million. Approximately $4 million
additional funding is needed, although funding sources of most of
the amount have been identified. This project is a collaboration of
the City of Bethel, the Yukon-Kuskokwim Health Corporation, the
Association of Village Council Presidents, the Chalista
Corporation, the Alaska National Guard, the Lower Kuskokwim School
District, the University of Alaska Kuskokwim Campus, the Regional
Housing Authority, and the Coastal Village Regional Fund.
5:29:45 PM
Co-Chair Green informed the Committee that this item was included
in the Governor's proposed budget.
There was no objection and Amendment #10 was ADOPTED.
5:30:19 PM
Amendment #11: This amendment deletes the City of Hope - Community
Safety and Development (HD 17-32) component of the Grants to
Municipalities (AS 37.05.315) BRU, Department of Commerce,
Community and Economic Development and $25,000 general fund
appropriation on page 10, lines 18 - 20.
This amendment also inserts a new Hope, Inc. - Community Safety and
Development (HD 17-32) component to the Grants to Named Recipients
(AS 37.05.316) BRU in the Department of Commerce, Community and
Economic Development and appropriates $25,000 general funds to the
component.
Accompanying explanatory language reads as follows.
The original request was made to "Hope, Inc.". During
drafting, the name was changed to "City of Hope" and moved to
"Grants to Municipalities. After discussion with the grants
administrator at the Division of Community Advocacy, the
original name "Hope, Inc.) was determined to be the correct
one.
Co-Chair Wilken moved for adoption.
Co-Chair Green overviews the explanatory statement.
The amendment was ADOPTED without objection.
5:31:01 PM
Amendment #12: This amendment changes the title of the City of
Homer - Homer Public Library Materials component of the Grants to
Municipalities BRU, Department of Commerce, Community and Economic
Development on page 10, lines 13 - 15 to "City of Homer - Public
Library Construction". The $100,000 general fund appropriation does
not change.
Co-Chair Green moved for adoption and explained the language
correction.
There being no objection, Amendment #12 was ADOPTED.
AT EASE 5:31:41 PM / 5:31:41 PM
Amendment #13: This amendment deletes the Denali Borough - Anderson
School/Septic Leach Field Replacement (HD 7-11) component and the
Denali Borough - Cantwell School/Sprinkler System Fire Upgrade and
New Well (HD 7-11) component of the Grants to Municipalities BRU,
Department of Commerce, Community and Economic Development on page
10, lines 17 - 23.
This amendment also increases the general fund appropriation to the
Alaska Siberia Research Center, Inc. - Alaska Siberia WWII Memorial
Park Construction (HD 7-11) component of the Grants to Named
Recipients BRU, Department of Commerce, Community and Economic
Development on page 4, lines 8 - 11 from $40,000 to $105,200.
This amendment also increases the general fund appropriation to the
Morris Thompson Cultural and Visitors Center - Construction
component of the Grants to Named Recipients BRU, Department of
Commerce, Community and Economic Development on page 7, lines 11 -
13 from $200,000 to $300,000.
This amendment also inserts a new Ester - Volunteer Fire Department
component to the Grants to Named Recipients BRU, Department of
Commerce, Community and Economic Development and appropriates
$125,000 general funds to the component.
Accompanying explanatory language reads as follows.
Partial funding for the Anderson School/Septic Leach Field
Replacement and the Cantwell School/Sprinkler System Fire
Upgrade and New Well projects totals $260,200 are deleted in
this amendment.
Full funding for these two projects are contained on page 77,
lines 24 - 31 of the work draft.
This amendment reallocates the $260,200 to the following three
projects:
Alaska Siberia Research Center $ 35,200
Morris Thompson Cultural Center 100,000
Ester Volunteer Fire Department 125,000
Co-Chair Wilken moved for adoption.
Co-Chair Green objected.
Co-Chair Wilken overviewed the amendment, which he sponsored on
behalf of Senator Ralph Seekins. This amendment would have a net
zero impact.
AT EASE 5:32:34 PM / 5:32:57 PM
The amendment was ADOPTED without objection.
5:33:21 PM
Amendment #14: This amendment changes the title of the Kenai
Peninsula Borough - Mobile Hydration Unit (HD 33-35), Grants to
Municipalities BRU, Department of Commerce, Community and Economic
Development on page 14, lines 28 - 30 to read "Kenai Peninsula
Borough/Bear Creek Fire Service Area - Mobil Hydration Unit (HD 33-
35)". The $71,500 general fund appropriation remains unchanged.
Co-Chair Wilken moved for adoption on behalf of Senator Gary
Stevens.
There was no objection and Amendment #14 was ADOPTED.
5:33:36 PM
Amendment #15: This amendment deletes the Kenai Peninsula Borough -
Refurbish Kachemak Fire Truck (HD 33-35) component of the Grants to
Municipalities BRU, Department of Commerce, Community and Economic
Development and $100,000 general fund appropriation on page 15,
lines 9 - 11.
Co-Chair Wilken moved for adoption of the amendment on behalf of
Senator G. Stevens.
The amendment was ADOPTED without objection.
5:34:02 PM
Amendment #16: This amendment changes the title of the Kenai
Peninsula Borough - Road Access to Utilities to Senior Housing Site
(HD 33-35) component of the Grants to Municipalities BRU,
Department of Commerce, Community and Economic Development on page
15, lines 12 - 16 to read "Kenai Peninsula Borough/Cooper Landing
Senior Citizens Corp., Inc. - Road Access to Utilities to Senior
Housing Site (HD 33-35)". The $71,000 general fund appropriation
remains unchanged.
Co-Chair Wilken moved for adoption.
Without objection the amendment was ADOPTED.
5:34:17 PM
Amendment #17: This amendment changes the title of the Kenai
Peninsula Borough - Water Tender (HD 33-35), Grants to
Municipalities BRU, Department of Commerce, Community and Economic
Development on page 15, lines 19 and 20 to read "Kenai Peninsula
Borough/Kachemak Emergency Service Area - Water Tender (HD 33-35)".
The $75,000 general fund appropriation remains unchanged.
Co-Chair Wilken moved for adoption.
There being no objective Amendment #17 was ADOPTED.
5:34:29 PM
Amendment #18: This amendment changes the title of the Municipality
of Anchorage - Anchorage School District/Gladys Elementary Supplies
(HD 17-32) component of the Grants to Municipalities BRU,
Department of Commerce, Community and Economic Development on page
18, lines 19-22 to read ?"Gladys Wood Elementary Supplies". The
$10,000 general fund appropriation remains unchanged.
This amendment also changes the Municipality of Anchorage - Kincaid
Park Summer and Winter Recreational Improvements, Fields, Paving
and Equipment (HD 17-32) component of the Grants to Municipalities
BRU, Department of Commerce, Community and Economic Development on
page 23, lines 18 - 23 to be a new component titled Kincaid Park
Project Group - Kincaid Park Summer and Winter Recreational
Improvements, Fields, Paving and Equipment (HD 17-32). The $480,000
general fund appropriation remains allocated to the project.
This amendment also changes the Municipality of Anchorage - South
Anchorage Sports Complex Ball Fields (HD 17-32) component of the
Grants to Municipalities BRU, Department of Commerce, Community and
Economic Development on page 24, lines 19 - 22 to be a new
component titled American Legion Baseball Association - South
Anchorage Sports Complex Ball Fields (HD 17-32). The $450,000
general fund appropriation remains allocated to the project.
Co-Chair Green moved for adoption and explained the technical
corrections.
There being no objection Amendment #18 was ADOPTED.
5:35:12 PM
Amendment #19: This amendment inserts a new bill section to read as
follows.
Sec. XX. DEPARTMENT OF FISH AND GAME. The sum of $50,000 is
appropriated from the general fund to the Department of Fish
and Game, Boars of Fisheries and Game, for Board of Game
activities related to review of Tier II subsistence proposals
for the fiscal year ending June 30, 2005.
Co-Chair Wilken moved for adoption.
Co-Chair Green objected for an explanation.
Co-Chair Wilken read the language of the amendment and informed
that Board of Game member, Ron Summerville, brought this request to
his attention.
Senator Dyson objected for further discussion. Committee Members
were told that appropriations in this budget would be limited to
construction projects and that funding for studies would not be
considered. While he considered this proposed study to be valid and
appropriate, he asked the criterion in determining which studies
would receive funding.
Senator Hoffman requested an explanation of what the proposed
review is expected to accomplish.
5:36:47 PM
MATT ROBUS, Director, Division of Wildlife Conservation, Department
of Fish and Game, testified this item is actually a FY 05
supplemental budget request. The Board of Game, with assistance
from the Department, is developing a system to improve the Tier II
permit process for subsistence hunting. The Board determined that a
series of public hearings held in various areas of the State should
be held to inform people of the proposed changes and to receive
input before final action is taken at the March 2006 Board of Game
Meeting. This amendment would fund the expenses of holding these
hearings.
Senator Stedman asked if this item should be included as a capital
project.
5:38:27 PM
GINGER BLASDELL, Staff to Co-Chair Green, testified that the
amendment would be included in the portion of this legislation that
provides FY 06 supplemental appropriations. Similar amendment would
be offered.
Co-Chair Green stated the method of including supplemental capital
appropriations in the following fiscal year capital budget is a
historical practice.
5:39:27 PM
Senator Hoffman asked whether the hearings could be completed by
June 30, 2005, the end of the fiscal year.
5:39:37 PM
Mr. Robus informed that the hearings had already been held and the
expenses incurred. Final action was not taken at the March Board
Meeting, as all considerations were not resolved. An additional
Board of Game meeting is scheduled for June 2005 to continue the
process.
Co-Chair Green noted that this funding request would have been
submitted as a FY 05 operating budget supplemental item if the need
had been identified earlier.
Senator Olson asked if hearings would be held at locations within
the election district he represents.
Mr. Robus replied that the proposed changes would be specific to
the moose and caribou subsistence hunts in the Nelchina Basin of
Southcentral Alaska. Therefore, the hearings have been primarily
held in that region. Most of the State-issued subsistence hunting
permits are granted for these hunts and the majority of
controversies are centered in this area. If successful, the new
system could serve as a pilot project for Tier II hunting in other
areas.
Senator Stedman objected to the adoption of this amendment.
Senator Olson asked if additional travel would be planned for the
following year.
Mr. Robus was unsure. The intent is that regulations would be
adopted at the June meeting.
Senator Stedman removed his objection.
Senator Dyson removed his objection.
Without further objection, Amendment #19 was ADOPTED.
5:42:15 PM
Amendment #20: This amendment inserts a new National Coastal
Wetland Conservation Grant - Snyder Parcel component to the
Department of Fish and Game on page 35 and appropriates $310,000
Other Funds to the component. Accompanying explanatory language
reads as follows.
The Snyder parcel is 135 acres of undeveloped wetland habitat
on the Gustavus forelands. The parcel is used by waterfowl and
shorebirds and provides important habitat for sandhill cranes.
It adjoins the Dude Creek Critical Habitat Area (CHA),
designated for the protection of sandhill crane habitat, and
is of interest to the Department of Fish and Game as a
potential addition to the CHA. Funding for the acquisition
will come from a third National Coastal Wetland grant, and
private donations. Title to the property will ultimately rest
with the state. The federal grant will have a $104,000 match
(25%) provided by The Nature Conservancy (TNC).
Acquisition of this parcel is the third and final phase of the
most biologically sensitive and least developable lands in
Gustavus; it will purchase approximately 135 acres. This is a
private parcel; the owner, John Snyder, contacted TNC with an
offer to sell. The lands will be managed to complement
adjacent habitats including the Dude Creek CHA. A further
management objective is to allow continues public use of the
lands for hunting, fishing, and recreation to the extent those
uses are consistent with the goal of protecting wetlands and
wildlife habitat.
Senator Hoffman moved for adoption. He outlined the explanatory
statement, pointing out that general funds would not be used.
There being no objection Amendment #20 was ADOPTED.
5:43:23 PM
Amendment #21: This amendment adds a new Bethel Youth Facility
Security Improvements component to the Department of Health and
Social Services on page 26 and appropriates $233,900 general funds
to the component.
Senator Hoffman moved for adoption of Amendment #21 and explained
the need for these improvements.
Co-Chair Green remarked that the proposed security improvements are
a worthy project.
There being no objection Amendment #21 was ADOPTED.
5:44:20 PM
Amendment #22: This amendment increases the allocation to the
Bethel Readiness Center New Construction - Phase 2 (HD 38) to the
Department of Military and Veterans Affairs on page 38 and
appropriates $8,062,500 federal funds and $2.5 million general
funds to the component. Accompanying explanatory language reads as
follows.
The Governor had funded the $2.5 million match with ASLC
[Alaska Student Loan Corporation] funds that were denied in
this version of the capital budget. $1 million in other funds
were kept but is not enough to match the $8,062,500 federal
funds. This amendment adds the additional $1 million the
Governor requested.
Senator Hoffman moved for adoption and stressed that the Bethel
Readiness Center is a very important project to the region.
Co-Chair Green clarified that $8 million in federal funds would be
received for this project.
The amendment was ADOPTED without objection.
5:45:31 PM
Amendment #23: This amendment adds a new Forest Legacy Federal
Grant Program component to the Department of Natural Resources and
appropriates $630,000 federal funds. Accompanying explanatory
language reads as follows.
These federal receipts have been approved under the Forest
Legacy Federal Grant Program for a conservation easement for
Aleknagik Natives Limited for over 20,000 acres of their land
within Wood-Tikchik State Park, which includes both banks of
the Agulowak River, a major salmon spawning area, and
approximately 32 miles of shoreline along Lakes Aleknagik and
Nerka. The Native allotments are in prime locations in the
southern half of the park. Wood-Tikchik State Park is near the
town of Dillingham in Southwest Alaska.
The Governor's original budget request included $2,930,963 for
three projects, which was not included in the work draft CS
(FIN) for SB 46. The federal government has just completed
their review of the project request and has approved $630,000
in funding to begin phase one for one of the projects, with
the initial phase to begin in FY 06, resulting in this amended
request. The other projects were not approved in this budget
year.
Senator Hoffman moved for adoption and overviewed the explanatory
statement.
There being no objection Amendment #23 was ADOPTED
5:46:33 PM
AMENDMENT #24: This amendment adds a new Coastal Wetlands Grant -
Nushagak Bay Watershed, phase 2 component to the Department of
Natural Resources and appropriates $1 million federal receipts to
the component.
Senator Hoffman moved for adoption and noted this item was included
in the Governor's FY 06 budget request.
There being no objection Amendment #24 was ADOPTED.
5:47:16 PM
Amendment #25: This amendment adds a new Petersburg North Harbor
Deferred Maintenance and Transfer (HD 5) component to the
Department of Transportation and Public Facilities, with intent
language, and appropriates $2.5 million general funds to the
component. The intent language reads as follows.
It is the intent of the Legislature that the City of
Petersburg enters into an agreement with the Department of
Transportation and Public Facilities to accept full
responsibility for ownership and maintenance of the North
Harbor at the time of transfer.
Senator Stedman moved for adoption, noting this item relates to the
process of transferring ownership of boat harbors from the State to
local municipalities. Funding for this transfer had been included
in the Governor's proposed FY 06 budget utilizing a different fund
source.
AT EASE 5:48:20 PM / 5:49:08 PM
Co-Chair Green remarked that the intent language is clear in
stipulating that the City of Petersburg would assume ownership and
responsibility for maintenance and repairs.
There being no objection Amendment #25 was ADOPTED.
5:49:34 PM
Amendment #26: This amendment corrects the House District
designation of the Craig Roads component in the Congressional
Earmarks BRU, Department of Transportation and Public Facilities on
page 65, line 19 to reflect the project's location in House
District 5. The $1 million allocation remains unchanged.
Co-Chair Wilken moved for adoption.
Co-Chair Green explained the technical change.
There being no objection Amendment #26 was ADOPTED.
5:50:00 PM
Amendment #27: This amendment inserts a new Bethel Courthouse
Improvements component to the Alaska Court System and appropriates
$825,000 general funds to the component. Accompanying explanatory
language reads as follows.
This capital request is one piece of two-part fix for the
Bethel court facility. The second piece is a $92,000 operating
budget increment to cover increased costs associated with
additional space. This has been funded in both the Senate and
House operating budgets.
The court system currently rents 10,000 s.f. from the City of
Bethel. The operating component will provide increased rent
for an additional 2,600 s.f. to be constructed by the City.
This capital component will allow the court system to make
tenant improvements to the existing space.
Bethel is a high-volume superior court location. Even though
the population of the area is less than 20% of the population
of Fairbanks, it had about 80% as many felony cases. Even
though it is much smaller than either Palmer or Kenai, last
year it had almost as many civil jury trials as Palmer and
Kenai put together.
This court has two superior court judges and two magistrates,
and a judge from Fairbanks is frequently there to help with
the caseload. In addition, the House and Senate operating
budgets have approved an upgrade of one magistrate position to
a district judgeship. However, the Bethel Courthouse currently
has only one superior courtroom, one district courtroom (with
room for only a six member jury), and a small hearing room.
Moreover, the remainder of the space is inadequate. Changes
proposed include adding two superior courtrooms, expanding and
soundproofing the cramped jury deliberation room, fixing a
number of security issues (for example, in-custody felony
defendants must currently be transported through public
areas), creating magistrate and law clerk offices, and
expanding the clerk's office.
The FY 06 request is for bid document preparation, project
management and construction.
Senator Hoffman moved for adoption and overviewed the explanatory
statement.
Co-Chair Green shared that she has received several telephone calls
regarding this project.
There being no objection Amendment #27 was ADOPTED.
5:50:55 PM
Amendment #28: This amendment reduces the general fund
appropriation to the Kenai Peninsula College Student Housing (HD
33-35) component of the University of Alaska on page 89, lines 4
and 5 from $7.5 million to $6 million.
This amendment also reduces the general fund appropriation to the
Kodiak College Vocational Technology Addition Phase I - Kodiak
Island Borough (HD 36) of the University of Alaska, on page 89,
lines 6 - 9 from $10 million to $8.5 million.
This amendment also inserts a new Kachemak Bay Campus Addition
component to the University of Alaska and appropriates $3 million.
Co-Chair Wilken moved for adoption.
Co-Chair Green explained the amendment noting it would have a net
zero fiscal impact to the FY 06 budget.
Senator Stedman clarified the affected campuses of the Kenai
Peninsula College, the Kodiak College, and Kachemak Bay.
There being no objection Amendment #28 was ADOPTED.
5:51:52 PM
Amendment #29: This amendment deletes the Fairbanks Area,
University Avenue/Geist Road/Johansen intersection project and the
$3.5 million Alaska capital income fund appropriation to the
project from Section 6. DEPARTMENT OF TRANSPORTATION AND PUBLIC
FACILITIES., on page 91, lines 7 and 8.
This amendment also inserts a new Fairbanks, Wilbur Street
Extension project in to Section 6 and appropriates $1.1 million to
the project.
This amendment also inserts a new Fairbanks, 2nd Avenue, Moore
Street Realignment and New Airport Way Intersection project in to
Section 6 and appropriates $2,550,000 to the project.
Accompanying explanatory language reads as follows.
These two projects are on the FMATS [Fairbanks Metropolitan
Area Transportation Study] priority list and will work
together with the currently funded upgrade of 2nd Avenue and
Wilbur Street to fund all planned access/egress projects
related to the Carlson Center/Growden Park/Fish Hatchery
complex area.
Co-Chair Wilken moved for adoption.
Co-Chair Green objected.
Co-Chair Wilken detailed the road changes and improvements
proposed.
AT EASE 5:52:35 PM / 5:53:08 PM
Co-Chair Wilken offered a motion to amend the amendment to
appropriate $1 million to the Wilbur Street Extension project and
$2.5 million to the 2nd Avenue project.
Without objection Amendment #29 was AMENDED and ADOPTED.
5:53:43 PM
Amendment #30: This amendment deletes the language of Section 10.
NATIONAL PETROLEUM RESERVE - ALASKA IMPACT GRANT PROGRAM; INTENT.
(b), on page 92, lines 16 - 20 and inserts new language to read as
follows.
(b) The sum of $24,706,539, received by the National
Petroleum Reserve - Alaska special revenue fund (AS 37.05.530)
under 42 U.S.C. 6508 by August 31, 2005, is appropriated to
the Department of Commerce, Community and Economic Development
from capital project grants under the National Petroleum
Reserve - Alaska impact grant program to the following
municipalities for the purposes stated in the amounts set out:
MUNICIPALITY PROJECT AMOUNT
(1) North Slope Borough Social and cultural $275,880
study - phase 2
(2) North Slope Borough Wainwright youth 229,500
program
(3) Nuiqsut Local government 468,000
operations/cultural
coordinator
(4) North Slope Borough Wainwright softball 35,000
field
(5) Barrow City impound and 174,389
disposal site project
(6) North Slope Borough Atqasuk energy 100,042
assessment
(7) North Slope Borough Wainwright local 311,500
government operations
(8) Barrow City Hall building 69,413
addition feasibility
study
(9) Nuiqsut Youth center operations 150,000
and maintenance
(10) Atqasuk Atqasuk local 336,468
government operations
(11) Barrow Roller rink renovation 63,556
feasibility study
(12) North Slope Borough Utility master plan/ 106,221
emergency plan
(13) North Slope Borough Misdemeanor probation 346,071
officer
(14) North Slope Borough Fire equipment and 250,000
training
(15) Barrow Barrow local 1,385,843
government operations
(16) Nuiqsut Design/install 200,000
retractable boat ramp
(17) North Slope Borough Continuing studies to 2,461,368
investigate
wildlife/subsistence
(18) North Slope Borough Oil spill response team 737,867
(19) North Slope Borough Police officers for 1,486,689
NPR-A villages
(20) North Slope Borough Health, survival, and 654,426
sustainability of key
subsistence resources
(21) North Slope Borough Workforce development 3,729,451
program
(22) North Slope Borough Mayor's job program 2,527,961
(23) North Slope Borough Police importation 1,101,512
combat program
(24) North Slope Borough North Slope science 425,578
initiative
(25) North Slope Borough Village capacity 968,182
building
(26) North Slope Borough NPR-A technical 1,468,508
review team
(27) North Slope Borough Allied health 3,400,000
training center
(28) North Slope Borough Wainwright city office 38,114
renovation
(29) Atqasuk Youth center addition 680,000
to community center
(30) North Slope Borough Wainwright lagoon 525,000
boat launch
(c) If the amount available for appropriation from the
National Petroleum Reserve - Alaska special reserve fund (AS
37.05.530) under (b) of this section is less than $24,706,539,
then each of the appropriations made by (b)(1) - (30) of this
section is reduced in proportion to the amount of the
shortfall.
This amendment also stipulates a lapse date of June 30, 2006 for
the appropriations made in Section 10(b)(1)-(13); a lapse date of
June 30, 2007 for the appropriations made in subsections (14)-(16);
a lapse date of June 30, 2008 for the appropriations made in
subsections (17)-(26); and a lapse date of June 30, 2009 for the
appropriation made in subsection (27). The appropriations made in
subsections (28)-(30) lapse under AS 37.25.020.
Co-Chair Wilken moved for adoption and outlined the projects
intended to receive federal National Petroleum Reserve-Alaska (NPR-
A) grant funds. The listing of projects would prioritize the
projects.
Senator Olson clarified that the lapse date for most of the
appropriations is the end of FY 06.
Co-Chair Wilken replied that the standard five-year lapse date
would apply to most of the capital projects. Appropriations made
for most of the operating expenses would lapse at the conclusion of
the fiscal year. Other items have specified lapse dates.
Senator Olson questioned whether adequate time would be allowed for
implementation.
5:57:40 PM
Co-Chair Wilken noted that the appropriations would not expire for
14 months.
Senator Olson surmised the lapse date of June 30, 2006 would be too
early to expend funds for capital projects.
5:58:11 PM
Co-Chair Wilken explained that the designated monies should be
expended in the fiscal year. Monies that would be carried forward
would automatically do so until the specified lapse date. This
would provide oversight for projects that currently have none. If
at the conclusion of FY 06, the lapse date were insufficient, the
affected community would be required to explain the situation and
request an extension.
5:59:39 PM
Senator Dyson appreciated Co-Chair Wilken's attempt. He asked the
percentage of the total appropriation allocated for operating
expenses.
Co-Chair Wilken answered that 42 percent of the funding is
designated to capital projects and 58 percent for operating
expenditures.
Co-Chair Wilken then pointed out that of the $24 million total NPR-
A grant, $22 million would be appropriated to the North Slope
Borough. He also noted the 21 percent administrative charge.
Co-Chair Green understood the provisions of this amendment are
intended to provide a review of the NPR-A grant program.
Co-Chair Wilken affirmed. Appropriations made in this manner would
allow for oversight of the expenditures. The intent is that the
grant funds are expended on those communities impacted by oil
development.
Senator Stedman asked if the inclusion of funds intended for
operating expenses are included in this capital budget due to
delays.
Co-Chair Wilken concurred. Previous appropriation of NPR-A grant
funds has been included as a single line item with no specification
of actual projects and programs. The language proposed in the
amendment allocates the funding for the four communities impacted
by activities in the NPR-A. Subsection (a) of Section 10 provides
intent language that future NPR-A impact mitigation program grants
be designated for this purpose.
6:03:20 PM
Without objection Amendment #30 was ADOPTED.
6:04:00 PM
Amendment #31: This amendment changes the name of the City of
Wasilla sewer plant expansion project in subsection (e) of Section
43. HOUSE DISTRICTS 13-16., on page 113, line 6 to "septage
facility".
Co-Chair Green moved for adoption and explained the technical
change.
There being no objection, Amendment #31 was ADOPTED.
6:04:23 PM
Amendment #32: This amendment deletes subsections (b) and (d) of
Section 53. DEPARTMENT OF COMMERCE, COMMUNITY AND ECONOMIC
DEVELOPMENT., on page 120, lines 1 - 4 and 9 - 12. The language of
the two subsections is identical and reads as follows.
The sum of $900,000 is appropriated from the general fund to
the Department of Commerce, Community and Economic Development
for payment as a grant under AS 37.05.316 to the Alaska
Housing Finance Corporation for construction of the cold
climate housing research center.
This amendment also inserts a new Cold Climate Housing Research
Center - Cold Climate Building & Infrastructure Research & Test
Facility component to the Grants to Named Recipients (AS 37.05.316)
BRU, Department of Commerce, Community and Economic Development, on
page 3 and appropriates $900,000 general funds to the component.
Accompanying explanatory language reads as follows.
In the 5/3/05 work draft version "Y" there were duplicate
requests (sections (b) and (d)) of $900,000 for the
construction of the Cold Climate Research Center.
This amendment deletes one of the $900,000 appropriations and
moves the funding to the Grants to Named Recipients (AS
37.05.316) portion of the work draft that begins on page
three.
This is consistent with previous appropriations made to the
project.
Co-Chair Wilken moved for adoption and explained the changes.
There being no objection, Amendment #32 was ADOPTED.
6:05:11 PM
Amendment #33: this amendment inserts a new Sport Fish Hatcheries
component to the Department of Fish and Game on page 35 line 11 and
appropriates $62,140,000 to the component. Accompanying explanatory
language reads as follows.
The state Department of Revenue would issue revenue bonds with
a gross amount of $69,000,000 but the actual construction
costs of the statewide hatcheries would be $62,140,000. The
gross bond amount would have adjustments made for underwriter
spread, true interest costs, debt service reserve fund and
earnings.
The $62.14 million in hatchery bond funds would be spent as
follows:
Interior Alaska - Fish presently stocked in interior Alaska
are produced in Anchorage and transported via the road system.
Currently, about 20% of the fish produced in the existing
hatchery program go to Fairbanks and the surrounding areas.
The imminent loss of heat at the existing Anchorage area
hatcheries will drastically affect the interior-stocking
program. Without warm water (which doubles the growth rate of
fish), the hatcheries will not be able to produce fish in the
sizes currently stocked in interior waters. A recent study has
indicated that building a new hatchery in Fairbanks is the
best way to remediate the problem. The proposed hatchery will
at least double the existing fish production goals for this
area, meeting projected demand over the next 25 years. It is
estimated that the hatchery will cost $25 million, 15 million
of which will be funded under the CIP. The balance of the
monies will come from federal funds already secured or
anticipated.
Southcentral Alaska - The imminent loss of heat at the
existing Anchorage area hatcheries will drastically affect the
southcentral Alaska stocking program. Loss of heat at the
existing hatcheries will not only decrease the number of fish
planted throughout southcentral Alaska, but will decrease the
number of sites that will be stocked. A recent study has
indicated that building a new hatchery in Anchorage is the
best way to remediate the problem. We propose to address this
issue by constructing a new hatchery facility at the site of
the existing Fort Richardson hatchery in Anchorage. Hatchery
operations at the existing Elmendorf Hatchery in Anchorage
will be shut down. The new hatchery facility will increase
production by 50%, sufficient to meet projected demand over
the next 25 years. We anticipate this hatchery will cost just
over $45 million, the cost of which will be entirely covered
under the proposed bond.
Southeast Alaska - The Division of Sport Fish does not operate
any hatchery facilities in southeast Alaska, but supports
targeted private sector hatchery operations through
cooperative agreements aimed at increasing sport fishing
opportunities. Bond funds totaling $2.14 million will fund the
following projects: $1.5 million to the City of Skagway to
build a hatchery which they would operate; $0.5 million for
deferred maintenance for the Crystal Lake Hatchery near
Petersburg; and $140,000 for one time capital improvements by
the Northern Southeast Regional Aquaculture Association
(NSRAA) for Haines king salmon release.
Co-Chair Wilken moved for adoption and objected to the motion to
allow the Department of Fish and Game to explain the amendment.
6:05:42 PM
KELLY KEPLER, Director, Division of Sport Fish, Department of Fish
and Game, explained this amendment would authorize the issuance of
bonds to support construction of hatchery facilities.
Senator Hoffman asked the affect were the amendment not adopted.
Mr. Kepler replied that the monies would not be expended.
There being no objection, Amendment #33 was ADOPTED.
6:07:10 PM
Amendment #34: This amendment changes the YMCA of Fairbanks - Van
(HD 7-11) component of the Grants to Named Recipients (AS
37.05.316) BRU, Department of Commerce, Community and Economic
Development on page 8, lines 9 and 10 to read "ASYMCA of Fairbanks
- Van purchase and operation (HD 7-11)". The $50,000 general fund
appropriation remains unchanged.
Co-Chair Wilken moved for adoption and explained that this
amendment proposes a technical change to reflect program as the
armed services YMCA.
There being no objection, Amendment #34 was ADOPTED.
6:07:49 PM
Amendment #35: This amendment inserts a new subsection into Section
52. DEPARTMENT OF ADMINISTRATION., on page 119, following line 26
to read as follows.
(c) The sum of $4,350,000 is appropriated from the
general fund to the Department of Administration,
commissioner's office, for distribution to state agencies to
offset the increased chargeback rates for statewide services
as identified in the statewide federal cost allocation plan.
Co-Chair Green moved for adoption.
Ms. Blaisdell explained this appropriation, plus the appropriation
proposed in Amendment #36, would provide funding to offset some of
the expenses incurred through delivery of centralized services to
other State agencies that would otherwise be reimbursed by those
agencies.
Co-Chair Green remarked that inadequate funding has been allocated
for these reimbursements. This amendment would allow departments to
continue to receive centralized administrative services.
There being no objection, Amendment #35 was ADOPTED.
AT EASE 6:10:44 PM / 6:16:27 PM
Co-Chair Green reiterated the intent of Amendment #35 in
appropriating funding to all agencies for reimbursement of the cost
of centralized services.
Ms. Blaisdell stated that normally general funds would be
appropriated directly to the agencies, and the agencies would
reimburse the Department of Administration for the costs of the
centralized services. Conversely, this amendment would allow the
Department of Administration to provide the general funds to each
agency based on a cost-allocation plan. A similar provision was
adopted several years prior. She would verify the legality of this
action.
Co-Chair Green noted that this amendment is generally not allowed,
although an exception would be made in this instance.
6:17:43 PM
Amendment #36: This amendment inserts two new subsections into
Section 20. FUND TRANSFERS., on page 96, following line 18 to read
as follows.
(d) The sum of $12,000,000 is appropriated from the
general fund to the Alaska public building fund (AS
37.05.570).
(e) The amount necessary to have an unobligated balance
of $5,000,000 in the state insurance catastrophe reserve
account in accordance with AS 37.05.289 is appropriated from
the general fund to the state insurance catastrophe reserve
account (AS 37.05.289).
This amendment also deletes "$300,000" from subsection (b) of
Section 52. DEPARTMENT OF ADMINISTRATION., on page 119, line 25 and
inserts "$40,300,000". The amended language reads as follows.
(b) The sum of $40,300,000 is appropriated from the
general fund to the information services fund (AS
44.21.045(a)).
Co-Chair Green moved for adoption.
Ms. Blaisdell explained the $12 million appropriated to the Alaska
public building fund would be distributed to those state agencies
that participate in the public building fund. The monies would be
utilized for maintenance expenses.
Ms. Blaisdell next reminded that the State of Alaska is self-
insured. The appropriation made in Sec 20(e) would be utilized for
management costs.
Ms. Blaisdell spoke to the fund transfer of $40.3 million to the
information services fund. The information services fund is
utilized to pay expenses including payroll associated with
information services activities, communications and the enterprise
technology fund.
6:19:46 PM
Ms. Blaisdell clarified that the effective date of the provisions
in the amendment should be July 1, 2005.
Senator Stedman asked if the original dollar amount of $300,000
appropriated in Section 52(b) page 19 was a typographical error.
Ms. Blaisdell affirmed.
Co-Chair Green reminded the Committee of the discussions relating
to this matter beginning six to eight weeks prior, in which it was
determined that no more than 30 percent of the amount requested
would be appropriated for the information services fund. Many of
the participating agencies have received less than sufficient
funding for this purpose for several years.
There being no objection, Amendment #36 was ADOPTED.
AT EASE 6:21:36 PM / 8:25:39 PM
The bill was HELD in Committee.
ADJOURNMENT
Co-Chair Green adjourned the meeting at 08:25 PM.
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