Legislature(2019 - 2020)SENATE FINANCE 532
04/30/2019 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB91 | |
| SB103 | |
| SB104 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 91 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | SB 103 | TELECONFERENCED | |
| += | SB 104 | TELECONFERENCED | |
SENATE BILL NO. 104
"An Act relating to an appropriation limit; relating
to the budget responsibilities of the governor; and
providing for an effective date."
10:42:12 AM
Co-Chair Stedman MOVED to ADOPT proposed committee
substitute for SB 104, Work Draft 31-LS0804 (Wallace,
4/29/19).
Co-Chair von Imhof OBJECTED for discussion.
10:43:18 AM
JULI LUCKY, STAFF, SENATOR NATASHA VON IMHOF, noted that
there was one substantive change and one technical change
in the CS. The changes would not impact the fiscal note.
Ms. Lucky read from an Explanation of changes document
(copy on file):
version: 31-LS0804\K
Changes appropriation limit to $6.0 billion from $5.0
billion [Page 1, line 13;
conforming change page 3, line 11].
Technical correction deleting unnecessary language
referencing the use of capital
appropriations exceeding the cap in the calculation of
the spending limit in subsequent years [Sec. 2].
version: 31-LS0804\U
An exception for capital spending is added. An amount
equal to up to five percent of the total allowable
spending under the cap can be spent on capital
improvements
outside the cap.
Technical corrections to two sections of the bill that
do not change the intent:
Spending cap is increased by the cumulative
change in inflation [Page 1, line 13 through page
2, line 2].
Debt exceptions are clarified [page 2 lines
5-7 and 19-20].
10:44:35 AM
Senator Micciche asked whether the bill allowed additional
spending on capital in years where there were extra funds
and there was additional need for spending.
Ms. Lucky clarified that the bill put in place an
appropriation limit of $6 billion. The capital
appropriations language would allow an exception for an
amount up to 5 percent of the $ 6 billion. It would allow
an additional expenditure, not included in the cap, of 5
percent of the cap for the given year. Capital spending
could be done under the cap as well and would be up to the
legislature to decide.
10:46:15 AM
Senator Micciche asked why the cap went so far above
current UGF spend.
CAROLINE SCHULTZ, STAFF, SENATOR NATASHA VON IMHOF, stated
that after discussions on SB 103 and SB 104 the previous
day in committee, it was considered that the $5 billion
appropriation limit was inadequate. She referenced updated
spreadsheets entitled "Unrestricted General Fund short-term
budget expectation (1.5 percent inflation)," (copy on
file). She clarified that the spreadsheets considered three
scenarios: PFD: Surplus to dividend, PFD: 50 percent of
POMV, and PFD: Current statutory PFD.
10:48:06 AM
Senator Micciche summarized that because the bill chose to
have the dividend inside of the cap, a realistic
probability was that the 5 billion cap would be impossible.
He added that even $6 billion would require prudent
spending in the future to remain within the cap.
Ms. Schultz agreed. She added that the second spreadsheet
reflected a 50 percent POMV split. Under that calculation
for the dividend the cap only allowed an additional $56
million.
10:48:59 AM
Co-Chair von Imhof added that the cap would come into play
when the state's cash flow increased significantly. She
thought that the cap would put pressure to keep spending
down. She emphasized that the state did not have to spend
to the cap and could put money into savings. She pondered
the purpose of a cap and thought that it was to keep
spending down when cashflow was high.
10:50:30 AM
Senator Micciche appreciated Co-Chair von Imhof's comments.
He thought it was unfortunate that the spending cap did not
help in the present but would in the future. He asked about
the cumulative change in inflation. He asked whether the
calculation used the 5-year lagging CPI average.
Ms. Schultz replied in the affirmative. She explained that
the clarifying language was intended to emphasize that the
5-year moving average for inflation would be added in
subsequent years.
10:51:58 AM
Co-Chair Stedman looked at row 'T' on page two of the
spreadsheet document. He thought that the numeric needed to
be changed from 5 to 6.
Ms. Schultz affirmed that the change should be made. She
said she would make the change and redistribute. She
clarified that the math was still correct.
10:52:52 AM
Co-Chair von Imhof WITHDREW her objection.
10:53:10 AM
Senator Wilson OBJECTED for discussion. He spoke to his
objection. He shared that he was in favor of removing the
dividend from the cap altogether.
10:54:21 AM
Senator Micciche thought the PFD being inside of the cap
signified taking no position on the PFD but highlighted the
total amount that would need to be accounted for at payout.
He relayed that he did not have a problem with having the
PFD inside the cap.
Ms. Schultz agreed with Senator Micciche.
10:55:43 AM
Senator Hoffman agreed with Senator Wilson. He thought the
amount of the PFD and the attention the dividend received
ensured that it would be a subject of attention for future
years. He believed that for the legislature to put the
dividend within a spending limit weakened the spending
limit because the limit would be ignored. He said that the
number one reason that the spending limit would not be
adhered to would be because it would be restricted by
whatever level the dividend was set.
10:57:51 AM
AT EASE
10:59:28 AM
RECONVENED
Co-Chair von Imhof reminded the committee that Senator
Wilson had objected to adopting the CS.
Senator Wilson WITHDREW his OBJECTION. There being NO
further OBJECTION, it was so ordered.
Co-Chair von Imhof set the bill aside.
SB 104 was HEARD and HELD in committee for further
consideration.
Co-Chair von Imhof discussed housekeeping. She noted that
the 1:30 PM meeting would be Delayed to the Call of the
Chair following floor session.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 91 Concerns.pdf |
SFIN 4/30/2019 9:00:00 AM |
SB 91 |
| SB 91 Sponsor Statement, Sectional and project update.pdf |
SFIN 4/30/2019 9:00:00 AM |
SB 91 |
| SB 91 letters of support.pdf |
SFIN 4/30/2019 9:00:00 AM |
SB 91 |
| Hydro presentation 3-18_cw_3_25_18.pdf |
SFIN 4/30/2019 9:00:00 AM |
SB 91 |
| SB 103 Work Draft Version G.pdf |
SFIN 4/30/2019 9:00:00 AM |
SB 103 |
| SB 103 Explanation of Changes SB 103 (FIN).pdf |
SFIN 4/30/2019 9:00:00 AM |
SB 103 |
| SB 104 Work Draft Version K.pdf |
SFIN 4/30/2019 9:00:00 AM SFIN 2/4/2020 9:00:00 AM |
SB 104 |
| SB 104 Explaination of Changes version K.pdf |
SFIN 4/30/2019 9:00:00 AM SFIN 2/4/2020 9:00:00 AM |
SB 104 |
| SB 104 Unrestricted General Fund Spreadsheet.pdf |
SFIN 4/30/2019 9:00:00 AM |
SB 104 |
| SB 103 Support Letters.pdf |
SFIN 4/30/2019 9:00:00 AM |
SB 103 |
| SB 104 Support Letter.pdf |
SFIN 4/30/2019 9:00:00 AM |
SB 104 |