Legislature(2001 - 2002)
04/24/2002 08:42 PM Senate FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
CS FOR HOUSE BILL NO. 403(FIN) am(brf sup maj fld)(efd fld)
"An Act making appropriations for the operating and loan
program expenses of state government, for certain programs,
and to capitalize funds."
SENATE BILL NO. 289
"An Act making appropriations for the operating and loan
program expenses of state government, for certain programs,
and to capitalize funds; making appropriations under art. IX,
sec. 17(c), Constitution of the State of Alaska, from the
constitutional budget reserve fund; and providing for an
effective date."
CS FOR HOUSE BILL NO. 404(FIN)
"An Act making appropriations for the operating and capital
expenses of the state's integrated comprehensive mental health
program; and providing for an effective date."
SENATE BILL NO. 288
"An Act making appropriations for the operating and capital
expenses of the state's integrated comprehensive mental health
program; and providing for an effective date."
MULTI #1: This amendment to SCS CS HB 403, 22-LS1295\R, replaces
the language in Section 10 on page 53, following line 6 to read as
follows.
Sec. 10. LEGISLATIVE INTENT AND FINDINGS. (a) It is the
intent of the legislature that the amounts appropriated by
this Act are the full amounts that will be appropriated for
those purposes for the fiscal year ending June 30, 2003.
(b) The money appropriated by this Act may be expended
only in accordance with the purpose of the appropriation under
which the expenditure is authorized. Money appropriated by
this Act may not be expended for or transferred to a purpose
other than the purpose for which the appropriation is made
unless the transfer is authorized by the legislature by law.
See, Alaska Legislative Council v. Knowles, 21 P.3d 367
(Alaska 2001). All appropriations made by this Act are subject
to AS 37.07.080(e). A payment or authorization of a payment
not authorized by this Act may be a violation of AS 37.10.030
and may result in action under AS 37.10.030 to make good to
the state the amount of an illegal, improper, or incorrect
payment that does not represent a legal obligation under the
appropriation involved.
This amendment also deletes the language in Section 15 on page 54
lines 14 through 31 and page 55 lines 1 through 8 and inserts new
language to read as follows.
Sec. 15. ALASKA HOUSING FINANCE CORPORATION. (a) The board of
directors of the Alaska Housing Finance Corporation
anticipates that the net income from the second preceding
fiscal year will be available in each of the fiscal years 2004
through 2008. During fiscal year 2003, the board of directors
anticipates that $103,000,000 will be made available for
payment of debt service, appropriation for capital projects,
and transfer to the Alaska debt retirement fund (AS
37.15.011). Of that amount, approximately $84,299,967 will be
retained by the corporation for the following purposes:
(1) $1,000,000 for debt service on University of
Alaska, Anchorage, dormitory construction, authorized under
ch. 26, SLA 1996;
(2) $37,986,612 for debt service on the bonds
authorized under sec. 2(c), ch. 129, SLA 1998;
(3) $12,013,355 for debt service on the bonds
authorized under sec. 10, ch. 130, SLA 2000;
(4) $33,300,000 for capital projects.
(b) After deductions for the items set out in (a) of this
section are made, any remaining balance of the $103,000,000
anticipated by the board of directors of the Alaska Housing
Finance Corporation to be available in the fiscal year 2003 is
appropriated to the Alaska debt retirement fund (AS
37.15.011).
This amendment also increases the amount appropriated to Learning
Opportunity Grants from $12,372,000 to $16,510,000 in Section 24 on
page 58, line 4.
This amendment also inserts a subsection to Section 24. LEARNING
OPPORTUNITY GRANTS., on page 58, following line 15 to read as
follows.
(b) The unexpended and unobligated general fund balance
of that portion of the appropriation made by sec. 1, ch. 60,
SLA 2001, page 11, line 30, that is allocated on line 31
(Foundation Program - $665,017,700) is reappropriated to the
Department of Education and Early Development for the fiscal
year ending June 30, 2003, for payment as learning opportunity
grants to the school districts based on the school district's
average daily membership to pay for instructional programs
intended to improve student performance. Learning opportunity
grants will provide the opportunity to move schools toward
standards-based education, including vocational education
programs. The increased funding in available to pay for costs
associated with improving student performance by developing
standards-based programs, including implementation of
standards, aligning student assessment to standards, adopting
instructional models based on basic skills, performance tasks,
and projects, and adopting a standards-based reporting system.
Accomplishing this goal may include acquisition of textbooks
and other educational materials.
This amendment also inserts a new bill Section 41 on page 64
following line 18 to provide that Section 24 (b) takes effect June
30, 2002.
This amendment also reduces the general fund appropriation to the
Alaska debt retirement fund (AS 37.15.011) from $27,710,800 to
$14,663,600, in Section 34 (c) on page 62 line 2.
This amendment also deletes Section 34(k) on page 63, lines 2
through 10 and inserts four subsections to read as follows.
(k) The sum of $2,061,400 is appropriated from the
tobacco use education and cessation fund (AS 37.05.580) to the
Alaska debt retirement fund (AS 37.15.011).
(l) The sum of $100,000 is appropriated from the
investment loss trust fund (AS 37014.300) to the Alaska debt
retirement fund (AS 37.15.011).
(m) The sum of $783,100 from the fiscal year 2003
dividend that is declared by the Alaska Commission on
Postsecondary Education is appropriated from the education
loan fund (AS 14.42.210) to the Alaska debt retirement fund
(AS 37.15.011).
(n) The balance, including unobligated and unencumbered
earnings, of the international trade and business endowment
(AS 37.17.400) on July 1, 2002 is appropriated to the Alaska
debt retirement fund (AS 37.15.011).
This amendment also increases the appropriation of fee supported
services funds to the State Health Services Budget Request Unit
(BRU), Community Health/Emergency Medical Services component on
page 21, lines 14 and 15, to increase the total allocation from
$17,833,000 to $17,933,000.
This amendment also inserts a new bill section on page 57,
following line 26 to read as follows.
Sec. 23. DEPARTMENT OF HEALTH AND SOCIAL SERVICES. The
amount appropriated to the Department of Health and Social
Services for community health/emergency medical services under
the appropriation for state health services in sec. 1 of this
Act includes the unexpended and unobligated receipts from
business license endorsement fees collected under AS 43.70.075
by the Department of Community and Economic Development during
the fiscal years ending June 30, 2002, and June 30, 2003.
This amendment also inserts a new bill Section 42 on page 64
following line 18 to provide that the new Section 23 takes effect
June 30, 2002.
This amendment also inserts intent language to the Department of
Labor and Workforce Development, Labor Standards and Safety BRU,
Alaska Safety Advisory Council component on page 24 lines 12 and 13
to read as follows.
The amount appropriated by this appropriation includes the
unexpended and unobligated balance on June 30, 2002, of the
Department of Labor and Workforce Development, Alaska Safety
Advisory Council receipts under AS 18.60.840.
Accompanying explanatory language to this portion of the amendment
reads as follows.
This amendment is identical to language the House accepted and
provides the Alaska Safety Advisory Council the ability to
expend receipts received for the Governor's annual safety
conference.
This amendment also inserts intent language to the Department of
Natural Resources, Forestry Management and Development BRU and
component on page 28 lines 9 through 12 to read as follows.
The amount appropriated by this appropriation includes the
unexpended and unobligated balance on June 30, 2002, of the
timber receipts accounts (AS 38.05.110).
Accompanying explanatory language to this portion of the amendment
reads as follows.
This amendment is identical to language the House accepted and
provides the Forestry Management and Development increased
timber receipt authority.
This amendment also adds and deletes funds in the amounts specified
to agencies as follows.
Department of Administration
Motor Vehicles BRU and component
Page 5, lines 17 and 18
$100,600 general funds
281,700 General Fund Program Receipts
Department of Community and Economic Development
Community Assistance & Economic Development BRU
Community and Business Development component
Page 6, lines 13 and 14
($160,000) general funds
Community Assistance & Economic Development BRU
International Trade and Market Development component
Page 6, lines 15 and 16
$100,000 general funds
Insert intent language to read, "This appropriation
includes $100,000 for a grant to a named recipient, the
World Trade Center, for a project development grant."
Department of Corrections
Administration and Operations BRU
Agency-Wide Unallocated Reductions new component
Page 9
$1,000,000 general funds
Department of Education and Early Development
K-12 Support BRU
Foundation Program component
Page 11, line 15
$4,138,000 general funds
Note: This transaction brings LOGs [Learning
Opportunity Grants] to a total of $16.51 million. This
amount plus a reappropriation of FY 02 lapsing balance
brings LOGs to a total of $23.32 million, which offsets
inflation of 2.9 percent.
Teaching and Learning Support BRU
Quality Schools component
Page 11, line 26
$130,000 general funds
Kotzebue Technical Center Operations Grant BRU and
component
Page 12, lines 29 through 32
$470,000 general funds
(470,000) ACPE [Alaska Commission on Postsecondary
Education] Dividend
Alaska Postsecondary Education Commission BRU
WWAMI Medical Education component
Page 13, line 27
$63,100 general funds
(63,100) ACPE Dividend
Department of Environmental Conservation
Environmental Health BRU
Food Safety & Sanitation component
($ 654,000) Federal Receipts
613,200 general funds
( 1,576,100) GF Program Receipts
1,576,100 Receipt Supported Services
Environmental Health BRU
Solid Waste Management component
Page 11, line 10
$230,400 general funds
(230,400) GF Program Receipts
Air and Water Quality BRU
Air Quality component
Page 14, line 14
($175,000) Federal Receipts
25,000 GF Program Receipts
150,000 general funds
Non-Point Source Pollution Control BRU and component
Page 14, lines 21 and 22
$715,400 Federal Receipts
Department of Fish and Game
Commissioner's Office BRU
Agency-wide Unallocated Reduction new component
Page 15, following line 13
($1,485,700) general funds
Commercial Fisheries BRU
Westward Region Fisheries Management component
Page 15, lines 24 and 25
$741,000 general funds
Commercial Fisheries BRU
Headquarters Fisheries Management component
Page 15, lines 26 and 27
$744,700 general funds
Department of Health and Social Services
Public Assistance BRU
Adult Public Assistance component
Page 18, line 18
($1,250,000) general funds
Medical Assistance BRU
Medicaid Services component
Page 18, line 28
($3,230,000) general funds
(1,000,000) Tobacco Education
Purchased Services BRU
Foster Care Special Need component
Page 19, line 31
($250,000) general funds
Purchased Services BRU
Subsidized Adoptions & Guardianship component
Page 20, lines 3 and 4
($1,500,000) general funds
State Health Services BRU
Tobacco Prevention and Control component
Page 21, lines 23 and 24
$1,000,000 Tobacco Education
Alcohol and Drug Abuse Services BRU
Alcohol and Drug Abuse Treatment Grants component
Page 21, lines 31 and 32
$1,000,000 general funds
Department of Labor and Workforce Development
Labor Standards and Safety BRU
Wage and Hour Administration component
Page 24, line 8
($102,000) general funds
Labor Standards and Safety BRU
Mechanical Inspection component
Page 24, line 9
($110,000) general funds
Department of Military and Veterans Affairs
Local Emergency Planning Committee Grants BRU
Local Emergency Planning Committee component
Page 26, lines 30 and 31
$50,000 general funds
(50,000) ILTF [Investment Loss Trust Fund]
Alaska National Guard Benefits BRU
Educational Benefits component
Page 27, line 13
$250,000 general funds
(250,000) ACPE Dividends
Department of Natural Resources
Oil and Gas Development BRU and component
Page 28, line 14
$400,000 general funds
(400,000) I/A [Inter-Agency] Receipts
Parks and Recreation Management BRU
Parks Management component
Page 28, line 31
($1,445,000) GF Program Receipts
2,225,800 Receipts Supported Services
RS2477 Navigability Assertions & Litigation Support BRU
and component
Page 29, lines 13 through 15
$150,000 general funds
(75,000) CIP [Capital Improvement Project]
Receipts
Department of Public Safety
Alaska State Troopers BRU
Search and Rescue component
Page 30, line 26
$50,000 general funds
(50,000) ILTF
Alaska State Trooper Detachments BRU and component
Page 30, lines 31 and 32
$2,200,000 general funds
Statewide Support BRU
Alaska Criminal Records and Identification component
Page 31, lines 31 and 32
$200,000 Receipts Supported Services
Department of Revenue
"Replace all non-general fund year three salary
reductions removed by the subcommittee."
Department of Transportation and Public Facilities
Statewide Facility Maintenance and Operations BRU
Central Region Leasing and Property Management component
Page 35, lines 24 and 25
$46,200 GF Program Receipts
Statewide Facility Maintenance and Operations BRU
Northern Region Leasing and Property Management component
Page 35, lines 26 and 27
$16,100 GF Program Receipts
Traffic Signal Management BRU and component
Page 35, line 29
$362,700 general funds
Highways and Aviation BRU
Central Region Highways and Aviation component
Page 36, lines 13 and 14
$359,200 general funds
130,000 GF Program Receipts
Highways and Aviation BRU
Northern Region Highways and Aviation component
Page 36, lines 18 and 19
$729,500 general funds
Highways and Aviation BRU
Southeast Region Highways and Aviation component
Page 36, lines 20 and 21
$41,100 general funds
University of Alaska
University of Alaska BRU
Budget Reductions/Additions-Systemwide component
Page 37, lines 32 and 33
$8,000,000 general funds
Alaska Court System
Alaska Court System BRU
Appellate Courts component
Page 38, line 29
$96,700 general funds
Alaska Court System BRU
Trial Courts component
Page 38, line 30
$747,600 general funds
25,000 MHTAAR [Mental Health Trust Authority
Authorized Receipts]
Alaska Court System BRU
Agency-wide Unallocated Reduction component
Page 38, lines 32 and 33
$1,655,700 general funds
This amendment also makes necessary conforming changes to
incorporate the provisions of this amendment into the bill.
This amendment also states that HB 262-STATE PROGRAM RECEIPTS/
BLDG.SAFETY ACCT would be amended to reflect fund source changes
from general fund program receipts, funding source 1005, to
receipts supported services, funding source 1156, to the following
components of the Department of Health and Social Services in the
amounts indicated.
Medical Assistance BRU
Medicaid Services component
Add: $364,000 Receipt Supported Services
Delete: $364,000 GF Program Receipts
Public Assistance Administration BRU and component
Add: $42,000 Receipt Supported Services
Delete: $42,000 GF Program Receipts
Purchased Services BRU
Foster Care Base Rate component
Add: $991,500 Receipt Supported Services
Delete: $991,500 GF Program Receipts
State Health Services BRU
Nursing component
Add: $112,100 Receipt Supported Services
Delete: $112,100 GF Program Receipts
State Health Services BRU
Maternal Child and Family Health component
Add: $340,500 Receipt Supported Services
Delete: $237,700 GF Program Receipts
State Health Services BRU
Community Health and Emergency Medical Services component
Add: $151,000 Receipt Supported Services
Delete: $51,000 GF Program Receipts
State Health Services BRU
Public Health Laboratories component
Add: $72,700 Receipt Supported Services
Delete: $72,700 GF Program Receipts
Alcohol and Drug Abuse Services BRU
Alcohol Safety Action Program component
Add: $650,800 Receipt Supported Services
Delete: $150,800 GF Program Receipts
Institutions and Administration BRU
Mental Health and Developmental Disabilities
Administration component
Add: $10,100 Receipt Supported Services
Delete: $10,100 GF Program Receipts
This amendment also states that HB 262-STATE PROGRAM RECEIPTS/
BLDG.SAFETY ACCT would be amended to reflect fund source changes
from general fund program receipts, funding source 1005, to
receipts supported services, funding source 1156, to the following
components of the Department of Transportation and Public
Facilities in the amounts indicated.
Administrative Services BRU
Regional Administrative Services component
Add: $155,000 Receipt Supported Services
Delete: $150,000 GF Program Receipts
Statewide Aviation BRU and component
Add: $226,300 Receipt Supported Services
Delete: $226,300 GF Program Receipts
Design and Engineering Services BRU
Central Design and Engineering Services component
Add: $234,500 Receipt Supported Services
Delete: $234,500 GF Program Receipts
Design and Engineering Services BRU
Northern Design and Engineering Services component
Add: $121,200 Receipt Supported Services
Delete: $121,200 GF Program Receipts
Design and Engineering Services BRU
Southeast Design and Engineering Services component
Add: $81,400 Receipt Supported Services
Delete: $81,400 GF Program Receipts
Statewide Facility Maintenance and Operations BRU
Central Region Leasing and Property Management component
Add: $579,600 Receipt Supported Services
Delete: $579,600 GF Program Receipts
Statewide Facility Maintenance and Operations BRU
Northern Region Leasing and Property Management component
Add: $571,500 Receipt Supported Services
Delete: $571,500 GF Program Receipts
Highways and Aviation BRU
Central Region Highways and Aviation component
Add: $705,300 Receipt Supported Services
Delete: $705,300 GF Program Receipts
Highways and Aviation BRU
Northern Region Highways and Aviation component
Add: $760,100 Receipt Supported Services
Delete: $760,100 GF Program Receipts
Highways and Aviation BRU
Southeast Region Highways and Aviation component
Add: $377,400 Receipt Supported Services
Delete: $377,400 GF Program Receipts
Description: These changes allow the Department to collect
receipts and reimburse the State's expenditure to offer the
specific program and/or service. Specifically, these receipts
are from airport property leasing, utility right-of-way
permits and the Highway Damages Program.
Co-Chair Kelly moved for adoption of the amendment.
DNR #1: This amendment inserts a new bill section to read as
follows.
Sec. _. MCKINLEY MEAT PACKING PLANT. The sum of $300,000
is appropriated from the agriculture revolving loan fund to
the Department of Natural Resources, Division of Agriculture,
for the fiscal year June 30, 2003, for part time operating and
preparation for transfer to the private sector of the McKinley
meat packing plant. The Department of Natural Resources will
provide a report to the legislature by February 1, 2003, on
actions taken toward implementation of a plan to transfer the
meat packing plant to the private sector.
Accompanying explanatory language reads as follows.
The McKinley Meat Packing Plant is owned by the ARLF and has
been operated by the Department of Corrections for a number of
years at a cost of $300,000 per year. This appropriation is
intended to keep the plant open for one year and help move the
meat plant to the private sector.
Co-Chair Donley instructed that this amendment is to be included in
MULTI #1, thus amending MULTI #1.
Co-Chair Donley announced another amendment to MULTI #1 to change
the $1,000,000 general fund appropriation to the Department of
Corrections, Administration and Operations BRU, Agency-Wide
Unallocated Reduction component. The amended amendment appropriates
$750,000 to the Division of Institutions component and $250,000 to
the Office of the Commissioner component.
Co-Chair Donley began to detail the entire amendment, noting the
first change inserts intent language into the bill.
DAVID TEAL, Director, Division of Legislative Finance spoke to the
changes to Section 15. Alaska Housing Finance Corporation. (AHFC),
which changes the method that AHFC dividends are allocated to the
general fund. He explained the original language of HB 403
stipulates that the entire $103 million amount available for the
dividend is allocated to the State with the Legislature
reappropriating a portion of the funding to the Corporation for
AHFC capital projects. He stated this amendment provides that the
appropriation process for the AHFC dividend is the same as
traditionally employed, in which approximately $84 million of the
FY 03 dividend amount would be retained by the Corporation. He
noted this change is to alleviate concerns that the original
language would adversely affect the Corporation's bond rating.
Senator Hoffman referenced the $33.3 million specified for use by
the Corporation for capital projects. He had understood the actual
amount needed for capital projects was approximately $18 million.
He wanted to know the purpose of the additional $15 million
expenditures.
Mr. Teal responded that the AHFC requested over $40 million for
capital projects. He informed that the State earned approximately
$8 million from the sale of the tobacco settlement fund to the
Northern Tobacco Securitization Corporation, which would be used to
fund capital projects. He noted he was unsure which capital
projects would be undertaken with the funds provided to the AHFC,
although the Governor's proposed budget contained zero AHFC
dividend funds for use in the FY 03 operating budget. With the
changes in this amendment, he stated, $18.7 million would be
appropriated from the AHFC dividend to the debt retirement fund,
which allows the same amount of general funds to be available for
other purposes. He furthered that many of the remaining changes in
this amendment relate to the expenditure of these general funds.
Co-Chair Donley noted the increase to the learning opportunity
grants utilizing lapsed funding from the FY 02 K-12 Education
funding, as proposed in this amendment.
Mr. Teal calculated the total FY 03 funding for education is $23.3
million, including this increase for the learning opportunity
grants.
Mr. Teal next detailed the portion of the amendment reflecting the
reduced amount of general funds appropriated to the Alaska debt
retirement fund due to the increased appropriation of AHFC dividend
funds, as explained above. He noted this amendment also
appropriates to the debt retirement fund: $2,061,400 from the
tobacco use education and cessation fund, $100,000 from the
investment loss trust fund, and $783,100 from the Alaska Commission
on Postsecondary Education (ACPE) dividend fund. He stated these
amounts were appropriated to the funds in FY 02 and not spent. He
commented that these reappropriations would streamline the
operating budget in part to ease the workload of the budget
subcommittee for the following year.
Co-Chair Donley added that this is consistent with the FY 02 budget
process of reappropriating lapse funds from various funding sources
to the debt retirement fund, which allowed general funds to be
utilized for other purposes.
Senator Hoffman asked if funds would be appropriated for tobacco
education and cessation programs.
Co-Chair Donley affirmed.
Mr. Teal furthered that the unobligated and unencumbered earnings
of the international trade and business endowment fund would also
be reappropriated to the Alaska debt retirement fund.
Senator Hoffman asked the balance of this fund.
Co-Chair Donley answered approximately $5 million.
Mr. Teal next addressed the increase of $100,000 receipt supported
services funds to the Department of Health and Social Services as
reflected in the insertion of Section 23. He noted the language
allows the excess funds earned in FY 02 from tobacco endorsements
on businesses licenses to be spent in FY 03. He explained that the
predicted earnings of FY 02 were approximately $100,000, of which
$87,000 has been earned to date, although authorization to expend
these earnings was not granted to either the Department of
Community and Economic Development or the Department of Health and
Social Services. He stated that rather than lapsing these funds,
this amendment authorizes expenditure by the Department of Health
and Social Services.
Mr. Teal spoke to intent language this amendment inserts in the
Department of Labor and Workforce Development, Labor Standards and
Safety BRU, Alaska Safety Advisory Council component authorizing
the funds appropriated for the 2002 Governor's annual safety
conference to be spent for the same purpose in FY 03.
Mr. Teal noted similar intent language inserted in the Department
of Natural Resources, Forestry Management and Development BRU and
component to allow the expenditure of the unexpended and
unobligated balance of FY 02 timber receipts accounts.
Senator Hoffman asked the estimated amount of funds of the previous
two items.
Mr. Teal replied that the Alaska Safety Advisory Council usually
spends approximately $108,000 annually and that it is uncertain
whether this amount would be expended during FY 02. He did not know
the amount of timber receipt funds. He qualified this intent
language does not increase the authorized expenditures as specified
in Section 1 of the committee substitute.
Co-Chair Donley then listed the increases and reductions in Section
1 to each department as contained in the amendment.
Mr. Teal pointed out the $4,138,000 general fund appropriation to
the Department of Education and Early Development, K-12 BRU,
Foundation Program component, is not a duplicate transaction, but
rather the same transaction, which appears in this section as well
as the Language section.
Senator Wilken spoke to the $130,000 general fund increase to the
Department of Education and Early Development, Teaching and
Learning Support BRU, Quality Schools component. He explained
relates to a special education assessment contained in SB 133 and
"corrects a close-out issue" of the conference committee of the
previous year.
Senator Leman addressed the funding changes to the Department of
Environmental Conservation, noting discussions on the matter were
held during the budget subcommittee process. He stated the increase
to the Environmental Health BRU, Food Safety & Sanitation component
would fully fund the Food Safety and Sanitation program. He
explained this increase involved replacing GF/Program Receipts
funding in other components in the Division of Environmental Health
to Receipt Supported Services funding.
Senator Leman explained the funding changes to the Environmental
Health BRU, Solid Waste Management component as "putting back some
monies that we were short."
Senator Leman stated that the funding change to the Air and Water
Quality BRU, Air Quality component is a correction. He added that
the Water Quality component funding changes utilize general funds
made available through other actions in the amendment.
Senator Leman spoke to the Non-Point Source Pollution Control BRU
and component, saying the funds involved are "Section 319 monies";
of which $250,000 is allocated to the Division of Forestry
Management, Forest Practices Act, and $500,000 allocated to the
Soil and Water Conservation Districts. He furthered that of the
$500,000 allocation, $475,000 would be awarded as various grants
for Section 319 projects.
Senator Hoffman was under the impression the State is eligible for
$1 million federal funds if matched with $750,000 general funds.
Senator Leman replied that "quite a bit of that still stays in the
Department."
Senator Hoffman asked about the discrepancy between the $1.7
million federal receipts available and the $750,000 indicated in
this amendment.
Senator Leman responded that $750,000 refers only to the funds
impacted by this amendment.
Co-Chair Donley continued by addressing the funding changes of the
amendment to the Department of Fish and Game. He explained that
funding is allocated to the Commercial Fisheries BRU, Westward
Region Fisheries Management component and Headquarters Fisheries
Management component, although the same amount is deleted from the
Commissioner's Office BRU, Agency-wide Unallocated Reduction
component, resulting in a net zero impact. He commented this change
provides the Department flexibility.
Co-Chair Donley stated that funding reductions to the Department of
Health and Social Services reflects the adjustment of needs
estimates for the following year to "lower case scenarios".
Senator Green explained that the budget of the previous year funded
these programs based on low case scenarios, although this year, the
budget subcommittee proposed funding the programs using high case
scenarios. She stated this also applied to the federal Medicaid
program, as it was assumed that the percentage of matching federal
funding would not change. Because the amount of federal funding the
State would receive is unknown, she said this amendment proposes to
employ "middle ground" scenarios to allow distribution of
approximately $4 million to other programs.
Senator Hoffman comments that this portion of the amendment
"retreats ground" gained by the efforts of the budget subcommittee.
He referenced his earlier question regarding funding for tobacco
prevention and cessation programs, and also noted this amendment
allocates $1 million, of the $4 million requested for alcohol and
drug abuse services.
Co-Chair Donley agreed the amount of funding for these programs is
below the amounts passed by the House of Representatives. However,
he pointed out an additional $1 million is appropriated for tobacco
education and an additional $1 million is appropriated for alcohol
and drug abuse treatment services.
Co-Chair Donley furthered that although the House of
Representatives version of the budget includes more funding for
some programs, it also contains a larger unallocated reduction
amount, which could significantly influence the actual funding for
each program.
Senator Hoffman cautioned, "This sets the State up for a massive
supplemental next year" if not addressed at this time.
Senator Green remarked, "We have funded this budget so there is no
possibility of a supplemental" and stressed that the Governor's
proposed budget did not account for the potential $10.8 million
federal Medicaid funding shortfall, although the committee
substitute does. Since the shortfall is not certain, she opined the
committee substitute is actually "over funding" the Medicaid
program.
Senator Hoffman conceded this is one theory, however he stressed,
it anticipates low usage of services and if the need is actually
higher, supplemental funds would be necessary.
Senator Green countered that the committee substitute provides
adequate funds in anticipation of significantly higher usage of
Medicaid programs.
Senator Hoffman stated this accounts for growth that is
uncontrolled by the Legislature.
Co-Chair Donley next noted the funding source changes to the
Department of Military and Veterans Affairs reflects a replacement
of one-time fund sources with general funds.
Mr. Teal addressed the funding source changes to the Department of
Natural Resources, relaying that the Department does not anticipate
that the funds previously listed could be transferred from the
Division of Governmental Coordination and therefore general funds
would be used.
Co-Chair Donley pointed to the "large increase" of $2.2 million for
the Department of Public Safety, Alaska State Trooper Detachments
BRU and component.
Senator Hoffman asked if this retains the same number of positions
funded the previous year.
Co-Chair Donley was unsure, noting the Department would determine
how to utilize the funds. However, he stressed this appropriation
reflects an increase of approximately $1.7 million more than the
expenditures of the previous year, which is adequate to pay the
salary increases. He surmised this appropriation is adequate to
maintain all existing State Trooper, Fish and Wildlife Protection
Officer and Village Protection Safety Officer positions.
Mr. Teal spoke to the changes to the Department of Revenue noting
that the budget subcommittee, in its recommendation, had not
included funding for salary increases for all employees except
those of the Permanent Fund Dividend Division. He stated this
portion of the amendment provides general funds for the salary
increases, thus allowing the other fund sources that would have
been used for the salary increases, to be expended for other
purposes.
Co-Chair Donley commented this is "just maximizing the use of non-
general fund monies … in the salaries component."
Co-Chair Donley then noted this amendment increases funding to the
Department of Transportation and Public Facilities by approximately
$1.6 million.
Co-Chair Donley next pointed out that the committee substitute
includes the same amount of funding for the University of Alaska as
appropriated the year prior. He noted this amendment adds $8
million general funds to that amount.
Senator Hoffman remarked that the increased funding for the
Department of Transportation and Public Facilities "made quite a
bit of headway in the Department," but he asserted that "attention"
must be given to the Alaska Marine Highway System (MHS). He asked
the intention of the Committee on this matter.
Co-Chair Donley replied that the amount of funding for the MHS is
the same as provided in the budget passed by the House of
Representatives.
Senator Hoffman countered that the current proposal contains
approximately $1 million more in reductions over the House of
Representatives version, which he calculated as a "hole" of over $5
million in the amount needed to fully fund the program.
Co-Chair Donley then stated this amendment provides an additional
$2.5 million for the Alaska Court System, which is an increase over
the appropriation of the previous year and should provide adequate
funding for the salary increases and prevent any delays in the
trial system.
Senator Hoffman appreciated the co-chair's efforts to fund the
programs indicated in this amendment. He expressed, "it goes a long
way;" however he noted that other needs remain unaddressed. He
listed $4 million for the Department of Corrections to ensure a
safe and protected correctional system, and funds to operate the
PCE program.
Senator Wilken recognized the efforts to increase funding to the
University of Alaska, commenting the university is "well on its way
to maintaining [the] momentum that President Hamilton has started;
the majority of that momentum has been funded at this table." He
informed he would continue to work to provide additional funding to
"satisfy their needs". He expressed concern about the K-12
Education component, although he noted the additional funds is
beneficial. He announced he would offer amendments at the next
hearing on this bill and would continue efforts with the co-chair
to identify additional funds.
Senator Hoffman stated that the Constitutional Budget Reserve (CBR)
fund contains adequate funds to address Senator Wilken's concerns.
Co-Chair Donley summarized this amendment maintains the Senate
Majority "target" to remain below FY 02 general fund expenditures,
although it increases funding for public safety from the past year
and fully funds the impacts of salary increases. He continued that
the committee substitute and this amendment increases funding to
the Alaska Court System pointing out this branch depends
significantly on general funds for personnel costs, making it
difficult to absorb salary increases. He reiterated the additional
funding for K-12 education is sufficient to meet the foundation
funding formula. He qualified that PCE continues to be funded in
the fiscal note of SB 185.
Senator Hoffman remarked that funding to alcohol and drug abuse
treatment grants is of major concern to the State. He expressed
interest in reaching a resolution to the $3 million difference in
funding for this program.
Senator Austerman appreciated the efforts to "live within the
means". However, he had concerns about the Department of Fish and
Game budget and he reminded the co-chairs of their assurances to
adequately fund this Department.
Co-Chair Donley thanked Co-Chair Kelly for his efforts and Senator
Green for addressing the challenge of the Department of Health and
Social Services subcommittee, which he asserted is the most
difficult. Co-Chair Donley thanked Senator Leman for working to
find ways to shift general funds and locate additional receipt
supported services, Senator Wilken for his efforts to fund
education. Co-Chair Donley also thanked Senator Austerman and
thanked and Senator Ward, noting the Department of Corrections
involves a difficult budget and this version provides significantly
more funds than included in the budget passed by the House of
Representatives.
Senator Ward commented that if Alaska's government was a
dictatorship, he would simply shift funds to programs he determined
were of higher priority. However, he thanked the Committee for
spending less general funds than the previous year. He expressed
that although the State would be, "reaching into the savings
account" to obtain all necessary funds, the fund is not depleted.
Co-Chair Donley furthered this proposed budget is "the product of a
team effort" of the Senate Finance Committee.
Co-Chair Donley informed of his intent to adopt MULTI #1 as amended
at this meeting, and allow minority members an opportunity to
consider its impacts and offer additional amendments at the
following meeting.
Co-Chair Donley next thanked the members of the House of
Representatives for exercising fiscal discipline.
Senator Hoffman shared Senator Ward's concerns about the fiscal gap
but asserted the State's primary concern is public safety, health
and education, and warned of the consequences if these needs are
not addressed. He spoke of an incident in St. George involving a
report of sexual abuse of a child and the delay in responding to
the situation. He warned that not funding these programs is "sorely
neglecting responsibility".
There was no objection to the adoption of MULTI #1 as AMENDED, and
the amended amendment was ADOPTED.
Senator Leman offered a motion that "the intent and directive
language that appears in the House version of the budget that may
have inadvertently been left out of this working document be
incorporated by reference in the new committee substitute."
There was no objection and it was so ordered.
Co-Chair Donley ordered the bill HELD in Committee.
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