Legislature(2013 - 2014)SENATE FINANCE 532
02/24/2014 08:00 AM Senate FINANCE
| Audio | Topic |
|---|---|
| Start | |
| SB119 | |
| Fy 15 Governor's Budget Overview: Department of Public Safety | |
| Fy 15 Governor's Budget Overview: Department of Environmental Conservation | |
| SB124 | |
| SB132 | |
| SB109 | |
| SB104 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 119 | TELECONFERENCED | |
| + | SB 124 | TELECONFERENCED | |
| + | SB 132 | TELECONFERENCED | |
| + | SB 109 | TELECONFERENCED | |
| + | SB 104 | TELECONFERENCED | |
| + | TELECONFERENCED |
SENATE BILL NO. 104
"An Act relating to appropriations from the dividend
fund; creating the criminal fund; and providing for an
effective date."
9:45:00 AM
SENATOR FRED DYSON, offered a brief history of the
legislation that lead to SB 104. He said that in 2012 there
was court ordered restitution of victims totaling $600,000;
approximately $70,000 was given to the Violent Crimes
Compensation Board for distribution to victims. He asserted
that there were millions in court ordered restitution that
had not been paid. He said that the legislation was a
vehicle that would make priorities clearer and provide a
method for the funds to be accumulated. He opined that that
the Department of Corrections (DOC) was using $13 million
per year to pay for inmate healthcare with none of the
funds going to victims. He said that with the passage of
the Affordable Care Act prisoners would be eligible for
Medicaid, which would allow for the department to receive
reimbursement. He offered that the governor supported the
bill. He said that the bill would clarify ambiguity in
existing law.
9:50:53 AM
JOSHUA BANKS, STAFF, SENATOR FRED DYSON, spoke to the
fiscal impacts of the bill. He remarked that there were six
fiscal notes currently attached to the bill, and only one
had fiscal impact. He said that the DOC fiscal note had
been written to be larger than anticipated, but would be
updated as new information was brought to light. He
believed that even with the fiscal note, based on
projections for the 2014 dividend, there would be minimal
negative fiscal impact to DOC.
9:52:01 AM
Senator Dyson referred to a report from Legislative
Research Services (copy on file). He lamented that the
mission that the legislature has clearly articulated in law
had been ignored.
Vice-Chair Fairclough requested a sectional analysis.
Mr. Banks explained the document, "Section Analysis - CS SB
104 (STA)" (copy on file):
Section 1
AS 43.23.028(a)(5)
Prioritizes by order of importance the legislative
purposes for making certain individuals under AS
43.23.005(d) ineligible for a PFD to be: compensation
for crime victims, child support arrearages, court-
ordered rehabilitation programs, and other
incarceration or probation costs.
AS 43.23.028(a)(7)
References a new section of law to be used to
determine which agencies can receive money from the
Criminal Fund.
AS 43.23.028(b)
Adds language to allow money from the criminal fund to
go to the purposes listed in this section, after the
appropriation to the criminal fund.
Section 2
AS 43.23.031
A new section in law is created to deal with
appropriations from the criminal fund:
1. Section (a) sets the priority order for how the
money in the criminal fund should be appropriated and
the departments that should receive the money.
2. Sections (b) states that by October 1 of each year
the Violent Crimes Compensation Board will send to the
Office of Management and Budget the total amount of
compensable claims from the previous fiscal year and
the operating costs of the VCCB.
3. Section (c) states that by October 1 of each year
the child support services agency will report to the
Office of Management and Budget the total amount of
money owed towards child support arrearages of
incarcerated individuals.
4. Section (d) states that the Department of
Corrections will report to the Office of Management
and Budget the total amount of money owed towards
court-ordered drug or alcohol treatment.
5. Section (e) provides that the Office of Management
and Budget will use the amounts reported by each
department in sections (b)-(d) and the total amount of
money in the criminal fund under AS 43.23.028(a)(6) to
determine how much money should go to each department.
6. Section (f) states that the Office of Management
and Budget will send a report to the Legislature at
the same time the Governor submits the Operating
Budget listing the size of the appropriation to each
agency.
Section 3
AS 43.23.048
A new section is put into law to statutorily create
the Criminal Fund as an individual account within the
dividend fund consisting of money that would have been
paid to felons and certain misdemeanants had they not
been made ineligible under AS 43.23.005(d). This
section also emphasizes that the money in the Criminal
Fund may be appropriated in accordance with AS
43.23.031. Finally, this section states that it does
not create a dedicated fund in violation of Article IX
Section 7 of the Alaska State Constitution.
Section 4
AS 43.23.055
1. Subsection (6) is amended to allow the Department
of Revenue to create new regulations that are
necessary to implement the Department's new
responsibilities in AS 43.23.031.
2. Subsection (11) is added to give the child support
services agency the authority to use the list of
ineligible individuals to determine the amount of
child support arrearages owed by these individuals.
Section 5
This section provides that this bill will take effect
on July 1, 2014.
9:57:57 AM
Senator Hoffman asked whether there was a timeframe for
when the perpetrator would have their dividend reinstated.
Mr. Banks responded that under AS 43.23.005 an incarcerated
felon, third-time misdemeant, or a misdemeant with a prior
felony, would be ineligible to receive a dividend until
released from jail.
9:59:17 AM
Vice-Chair Fairclough asked how money got into the fund.
Mr. Banks deferred the question to the Permanent Fund
Division. He said that there was a list from DOC and the
Department of Public Safety (DPS) that DOR used to
determine which inmates should have their dividends
deposited into the criminal fund.
10:00:38 AM
Vice-Chair Fairclough asked how the dividends could help to
pay child support for the children of those incarcerated if
the inmates failed to apply for the permanent fund. She
wondered about the children of parents who did not apply
for the dividend, could the child collect their dividend
retroactively.
Senator Hoffman interjected that the child would not be
able to apply for the retroactive dividends until they
reached the age of 18. He thought that those children would
have expenses before the age of 18 and should not be
punished for their parents neglect. He opined that the
issue had yet to be addressed, even for children whose
parents were not incarcerated.
10:02:11 AM
Vice-Chair Fairclough stressed that the bill referred to
individuals who were leaving incarceration. She wanted to
understand the formula of how the money would be
distributed.
Mr. Banks deferred the question to LAW.
Senator Hoffman remarked that the department could apply on
behalf of the child for their parent's dividend if the
parent was delinquent in their child support payments.
Vice-Chair Fairclough reiterated he desire to understand
how money would be dropped into the fund.
10:04:12 AM
Co-Chair Meyer queried how the priority list for
distribution of the funds was established.
Mr. Banks responded that distribution was the per-view of
the legislature and the governor. He cited Page 3 of the
bill which listed the agencies that were currently eligible
to receive money from the criminal fund. He believed that
for budgetary purposes the CDVSA had opted to not receive
money from the criminal fund.
10:06:09 AM
Senator Dyson stressed that under the concept of victim
restoration the court would order that everything that the
victim needed for restoration would be covered by the fund.
CHUCK KOPP, STAFF, SENATOR FRED DYSON, explained that there
were no new entities in the bill. He asserted that the
legislation was crafted to assure that the victims were the
first on the priority list to receive money from the fund.
He stated that the intent of the bill was to establish the
fund in statute and to assure that money from the criminal
fund went first and foremost to victim restoration.
10:08:11 AM
Vice-Chair Fairclough explained that CDVSA had received
significant financial support from the criminal fund in the
past. In the past few years the legislature had been using
general fund dollars for the CDVSA and the felon monies had
been distributed elsewhere. She understood that the monies
had been going to programs inside of the DOC rather than to
victim restoration.
Co-Chair Meyer CLOSED public testimony.
10:09:35 AM
Vice-Chair Fairclough asked for more information regarding
how the money was distributed into the fund.
Mr. Banks responded that the process was conducted by DOR.
DAN DEBARTOLO, DIRECTOR, PERMANENT FUND DIVISION,
DEPARTMENT OF REVENUE, could not speak to how the dividend
program calculated the amount appropriated into the
criminal fund. Annually, the division matched a large file
from DOC that identified the incarcerated individuals
against the current dividend application list. He explained
that if incarceration was the only thing that was
disqualifying the individual for the dividend DOR applied
that percentage to the number of people in the file,
including those who did not apply in that year. He said
that the division then determined how many people would
have received a dividend, had they applied. The number of
people was then multiplied by the amount of the dividend
for the year, which determined the pool of funds reported
to the Office of Management and Budget (OMB). He said that
the amount had ranged over the years from $9 million to $19
million.
10:12:15 AM
Vice-Chair Fairclough requested further clarification.
Mr. DeBartolo responded that the calculation had been used
for a while. He said that the assumption was that not every
inmate that fell into one of the criminal fund categories
was applying for a dividend because they had become aware
that they were ineligible. The process allowed for the
division of account for those individuals.
Vice-Chair Fairclough felt that an individual who was
incarcerated should be required to apply for the PFD, in
order to provide for their family or contribute to the
criminal fund.
10:14:39 AM
Co-Chair Meyer noted that all of the money in the fund
could be used solely for priority one listed on Page 4 of
the bill.
Mr. Banks responded that there were two charts included in
the bill file. The first, "Historic PFD Criminal Fund
Appropriations"(copy on file), illustrated the DOA
appropriation that went to the Violent Crimes Compensation
Board. He said that the board had never needed more than $2
million and had received much more. He did not anticipate
that the Violent Crimes Compensation Board would take all
of the money from the criminal fund. He spoke to child
support, which was the next priority on the list. He said
that the drafters of the bill understood that all of the
funds could be used for child support, which had not been
the intent of the legislation; the CS had been amended to
limit one dividend per child support order. He referred to
the second chart, "Potential Appropriation Scenarios". He
said that the bill would have minimal impact on DOC's
budget.
10:17:25 AM
Vice-Chair Fairclough looked at the child support language
in the bill. She wondered whether there was a way that the
amount of money going to child support services could be
increased without damaging the budget of DOC.
Mr. Banks responded that the intent had not been to take
funds away from the department. He believed that the step
that had been taken to limit one dividend per order for
child support was a good solution.
10:19:35 AM
Vice-Chair Fairclough wondered if there was an order per
child, or per family. She specifically wondered if more
than one order could be submitted, creating further
bureaucracy.
Senator Dyson responded that the idea had been to provide
restitution retroactively. He said that there was a huge
amount of restoration due for businesses that had been
burglarized. It had been decided that those businesses that
received payment from insurance would not be a priority. He
stressed that he wanted the funds to go to individuals. He
said that the rearages on child support in the state ran
into the 10's of millions of dollars. He said that the
Child Support Enforcement Division had approached him with
the idea so that the child support unmet obligations would
not overpower other priorities. He stressed that it had not
been the intention to protect DOC from the loss of $12
million per year. He suspected that most people did not
realize that those funds were in the DOC budget in the
first place.
10:21:50 AM
Co-Chair Meyer understood one dividend would be ordered
regardless of the number of children in a household.
Mr. Banks replied in the affirmative.
10:22:39 AM
Vice-Chair Fairclough stressed that the state was using
percentages. She noted that the incarcerated individual may
not have applied for all of the children in their household
and wondered how those children would be compensated. She
asserted that she did not understand the method used by the
Permanent Fund Division to calculate the percentage.
Mr. Banks said that it was difficult to find a perfect
calculation to provide families with all of the necessary
support.
10:24:45 AM
Vice-Chair Fairclough remarked that the equation was
complicated. She disagreed with the use of percentages in
the calculation rather than using the number of actual
applicants. She felt that the current method created a
scenario where the funds were not making it to the victims.
Mr. Kopp explained that the bill sponsor was amenable to
the conversation spurred by Vice-chair Fairclough's
questions. He furthered that sideboards would be put in
place to assure that child support rearages would not eat
up the entire criminal fund. He agreed that the methodology
could be revisited.
10:27:11 AM
Vice-Chair Fairclough relayed that what she needed to see
was how DOR was calculating dividends and coming up with an
$8 million number to fund something, because it currently
was not funding victim restoration. She requested the
formula that DOR used.
10:28:02 AM
Co-Chair Meyer surmised that the money would be moved from
the criminal fund to the Violent Crimes Compensation Board.
He noted that the fiscal note for the board was zero.
Mr. Banks said that the fiscal note was zero because the
board did not anticipate any additional operating costs.
10:29:23 AM
KACI SCHROEDER, SPECIAL ASSISTANT, DEPARTMENT OF
CORRECTIONS, testified that the only concern that the
department had was any reduction in criminal fund receipts.
She said that any reduction would be met with a
corresponding general fund request.
10:30:21 AM
Vice-Chair Fairclough said that she had further questions
for DOC regarding work opportunities for inmates and their
ability to make money in order to provide restitution. She
requested additional information on sentencing and the
ability for inmates to access alcohol treatment and
substance abuse programs during incarceration.
Senator Dyson replied that the convicted felon was not
excused from their debt and obligation because their
forfeited dividend had gone into the criminal fund. He
added that he had considered the issue of covering multiple
children.
10:33:26 AM
Co-Chair Meyer remarked that the fiscal notes did not
reflect the $8.5 million being directed to the Violent
Crimes Compensation Board. He felt that the fiscal notes
needed to be studied and revised.
Mr. Banks replied that there was no anticipation of the
Violent Crimes Board receiving $8.5 million under the
legislation. He understood that the note spoke to the
worst-case scenario of the department losing the money that
they would receive from the criminal fund they would need
$8.5 million to backfill for their operating costs. He said
that looking at projections for the 2014 dividend the
department did not anticipate that there would be any loss.
10:35:46 AM
Mr. Kopp remarked that the bill sponsor was confident that
the legislation would not negatively affect DOC.
10:36:50 AM
Senator Hoffman asked for calculations for FY16 through
FY18 in order to examine how the fund would be distributed
at higher numbers.
Mr. Banks replied that there was a rough estimate of FY16
on the second chart.
10:38:11 AM
Senator Hoffman felt that the number did not calculate all
of the lower earning years of the dividend. He wondered if
there was the anticipation that the number would increase
in FY 17 and FY18.
Mr. Banks agreed to provide that information.
SB 104 was HEARD and HELD in committee for further
consideration.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 124 DPS Council on Domestic Violence and Sexual Assault Audit 2013.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 124 |
| SB 124 Sponsor Statement.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 124 |
| CS SB132 (STA).pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 132 |
| CS SB132(STA) Sponsor Statement.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 132 |
| SB 132 Fiscal Note VerA DOA.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 132 |
| SB 132 Leg Research Report.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 132 |
| SB 132 Public Opinion.msg |
SFIN 2/24/2014 8:00:00 AM |
SB 132 |
| SB 132 Summary of Changes-CS(STA).pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 132 |
| SB 109 Alaska_Lands_Update_11_2013.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 109 |
| SB 109 Alaska_Lands_Update_12_2013.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 109 |
| SB 109 CACFA 2013 Annual Report.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 109 |
| SB 109 Fiscal Note.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 109 |
| SB 109 Sectional Analysis.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 109 |
| SB 109 Sponsor Statement.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 109 |
| SB 104 - Section Analysis.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 104 |
| SB 104 - Sponsor Statement.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 104 |
| SB 104 - Support Document - HB 245 1988.pdf |
SFIN 2/24/2014 8:00:00 AM |
HB 245 SB 104 |
| SB 104 - Support Document LRS - Restitution.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 104 |
| SB104-DOC-OC-01-21-14.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 104 |
| SB104-DOR-CSSD-02-01-14.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 104 |
| Summary of Changes to Senate Bill 104.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 104 |
| SB 104 - Support Document - Letter VCCB.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 104 |
| SB 104 - Support Document - Criminal Fund Appropriations - 2.pdf |
SFIN 2/24/2014 8:00:00 AM |
SB 104 |