Legislature(2001 - 2002)
04/26/2001 06:17 PM Senate FIN
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SENATE BILL NO. 193
"An Act relating to a study of the economic and social effects
of the permanent fund dividend on the state."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Kelly informed that this bill speaks to a 1990 court
decision on Lindly vs. Malone.
Co-Chair Donley gave a history on the issue, beginning in 1988 when
he sponsored legislation to change the residency requirement for
the permanent fund dividend from six months to two years. He noted
a clause was inserted in this bill providing that in the event a
court found that two years is too long, the requirement would
automatically become one year.
Co-Chair Donley stated that since this time, he has learned the
longest length of residency that is acceptable for a benefit
qualification, according to the United States Supreme Court, is two
years. He detailed the ruling, which found that in certain
instances, such as with in-state tuition fees, it is acceptable to
stipulate up to two years as the residency requirement to prevent
exploitation from a transient population. He opined the Alaska
permanent fund is a comparable benefit in its attraction. He
surmised that the more lengthily two-year residency requirement
could be imposed in Alaska if there was evidence that people were
moving to the state for the purpose of receiving the dividend.
Co-Chair Donley continued, saying that when a state court found the
1988 legislation unconstitutional, the decision was not appealed to
the state Supreme Court because the state had not yet developed the
necessary evidence to show that this benefit was the reason people
were moving to Alaska.
Co-Chair Donley pointed out the amount of the dividends are
significantly higher then they were in 1988. He noted the residency
requirement was doubled through the legislation from six months to
one year, but that the matter of a two-year residency requirement
remained unresolved.
Co-Chair Donley explained that SB 193 provides that a study would
be conducted to learn if it could be determined whether there is a
problem with people attracted to the state because of the permanent
fund dividend and if a longer residency requirement is justified.
Senator Austerman inquired about the Longevity Bonus Program, which
provides subsidies to elderly Alaskan residents, and if this
program is in the process of being phased out.
Co-Chair Donley affirmed. He noted the original legislation of 1988
increased the residency requirement for this program as well, but
that this is no longer an issue since the program no longer accepts
new participants.
Co-Chair Donley moved to adopt CS SB 193, 22-LS0828\J as a working
draft.
There was no objection and the committee substitute was ADOPTED.
Amendment #1: This conceptual amendment replaces "general fund"
with "permanent fund earnings account" in Section 2 on page 2 line
2 of the committee substitute. The amended language reads as
follows.
The sum of $200,000 is appropriated from the permanent fund
earnings account to the Legislative Council for a study of the
economic and social effects of the permanent fund dividend on
the state.
Senator Leman commented that a permanent fund account, rather then
the general fund, is normally used when addressing legal matters
regarding the permanent fund and would be appropriate in this
legislation as well.
Senator Leman moved for adoption of the amendment.
Senator Ward objected.
There was some question as to the specific name of the fund and the
Division of Legislative Finance was requested to supply the correct
information.
Senator Wilken wanted to ensure the correct fund account was
inserted into the language.
The bill was HELD in Committee until later in the meeting.
SENATE BILL NO. 193
"An Act relating to a study of the economic and social effects
of the permanent fund dividend on the state."
[This bill was held earlier in the meeting. A motion to adopt
Amendment #1 was on the table.]
Senator Leman moved to amend his amendment to change the funding
source from the permanent fund earnings account to permanent fund
corporate receipts. The amended language reads as follows.
The sum of $200,000 is appropriated from the permanent fund
corporate receipts to the Legislative Council for a study of
the economic and social effects of the permanent fund dividend
on the state.
Senator Leman explained the change to the funding source as
recommended by the Division of Legislative Finance.
Senator Ward removed his objection to the adoption of the
amendment.
The amendment was AMENDED and ADOPTED without objection.
Amendment #2: This conceptual amendment deletes "the preparation
of" proceeding "a study of" from Section 1. LEGISLATIVE INTENT. On
page 1, lines 8 and 9 of the committee substitute. The amended
language reads as follows.
The legislature intends that the Legislative Council, in
consultation with the Department of Community and Economic
Development, the Department of Health and Social Services, and
the Department of Labor and Workforce Development, use the
appropriation made in sec. 2 of this Act to contract for a
study of the economic and social effects of the permanent fund
dividend on the state.
Co-Chair Kelly moved for adoption and explained this allows the
state to contract with a private organization to complete the
study.
Without objection, the amendment was ADOPTED.
Senator Green offered a motion to move CS SB 193, 22-LS0828\J, as
amended from Committee with new Legislature fiscal note for
$200,000.
The bill MOVED from Committee without objection.
AT EASE 8:46 PM / 8:46 PM
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