Legislature(1995 - 1996)
04/22/1995 10:05 AM House FIN
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* first hearing in first committee of referral
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HB 268 An Act making appropriations for capital project matching grant funds and to capitalize funds; making, amending, and repealing capital appropriations; and providing for an effective date. 1 HB 268 was HELD in Committee for further consideration. DEPARTMENT OF HEALTH AND SOCIAL SERVICES (DHSS) JANET CLARKE, DIRECTOR, DIVISION OF ADMINISTRATIVE SERVICES, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, spoke to the Department's capital budget request for the adoption and foster care analysis reporting system in the amount of $1.96 million dollars. Ms. Clarke provided background information on the request pointing out that the majority of the request (75%) would be provided through federal funding. In order for the federal government to provide those matching funds, the State must provide their share prior to September 30, 1995. Representative Martin asked the amount of money used by the Department for information systems in the past twelve years. Ms. Clarke agreed that a lot of money had been placed into that system, although, she noted that within the Department, there are many complex federal programs. Many of those systems have been developed to meet the requirements of the federal system. NANCY SLAGLE, DIRECTOR, DIVISION OF BUDGET REVIEW, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR, continued, the following DHSS's capital budget request for statewide renovation, repair and equiptment in the amount of $1.799 million dollars. She explained that this financing would address on-going maintenance to state owned facilities. Ms. Clarke pointed out that the request was half of the needed amount. Ms. Slagle continued, the Alaska family practice residency program renovation and equipment request in the amount of $250 thousand dollars would be used for a community health center and training program for physicians and midlevel practitioners in an Anchorage health care center. Ms. Clarke added that those funds would be used to renovate a clinic site and provide the needed equipment. Representative Martin stated that the proposed allocation would be for a new program and recommended that it should be added to the operating budget. Ms. Slagle advised that the funds would be used for renovations of an existing facility. Ms. Slagle continued addressing DHSS's capital budget request for the Yukon Kuskokwim (YK) public health facility design in the amount of $500 thousand dollars. Ms. Clarke explained that the public health nurses desperately need a facility in order to establish outpatient services. At this 2 time, the Yukon Kuskokwim (YK) public health facility has served nurses using the facility an eviction notice. The request would provide funds for a combined facility where the State public health nurses and the YKHC staff and services could be co-located. Ms. Clarke discussed that currently YKHC spends $600 thousand dollars in eight different Bethel leases. YKHC would like to get out of that situation in order to consolidate their services. Representative Martin asked if the corporation owned the hospital. Ms. Clarke explained that the State Public Health Service does not lease the building nor do they provide leasing costs. The hospital is not large enough to accommodate YK needs and those of the nurses at this time. Representative Brown asked if funding the proposed project could forestall eviction of the Public Health Service. ELFRIDA NORD, CHIEF, NURSING SECTION, DIVISION OF PUBLIC HEALTH, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, replied that there was a plan by YK to install modular structures for the nurses as a temporary basis which will then be used at a latter date by the hospital facility. Ms. Clarke noted that YKHC is pursuing federal funding to offset the costs of the facility. Representative Brown asked if future operating costs would be associated with a new facility. Ms. Clarke commented that new staff would not be needed to pay for the new structure operation. Ms. Slagle continued with DHSS's capital budget request for the department-wide computer aided productivity improvement system in the amount of $200 thousand dollars. The request would assist the Department in providing an upgrade in the network and then replacing machines and equipment which have been failing. Representative Brown requested a departmental breakdown of those projects. Ms. Slagle addressed the Department's capital budget request for a medicaid management information system reprocurement in the amount of $8.069 million dollars. She stressed that the majority of the request was federal dollars, noting that the system was a federal requirement. Ms. Clarke pointed out that this system was different from most other state computer systems. RANDY SUPER, DIRECTOR, DIVISION OF MEDICAL ASSISTANCE, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, provided greater detail regarding that request. He stated that the health financing administration has regulations which require 3 repurchase of systems from time to time. Discussion followed among Mr. Super and Representative Martin regarding the information system and the possibility of double counting. Representative Brown questioned the possibility of the U.S. Congress modifying rules which drive the states to incorporate such complicated systems. KAREN PERDUE, COMMISSIONER, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, responded that, currently, the Medicaid block grants are the subject of detailed debate. The chances of passage of a medicaid block grant this year could be 30% percent. A large amount of money would be at stake between the states and the federal government in order to implement such a grant. She added that discussions are on-going. Commissioner Perdue urged Committee members not to pass up an opportunity to receive the 90% federal funds in order that Alaska could manage costs better. Ms. Slagle continued listing DHSS's capital budget request line item in the amount of $1.05 million dollars for the Eligibility Information System (EIS). Those funds would provide for a feasibility study and needed enhancements to the eligibility information systems. (Tape Change, HFC 95-93, Side 1). Ms. Clarke commented that the request would create a new eligibility information system which could then increase productivity from workers and would protect the State from fraud within the food stamp program especially in rural communities. MARGO NASH, DEPARTMENT OF HEALTH AND SOCIAL SERVICES, spoke to the eligibility information system. She noted that the funding requested would provide for three major systems. She added that there would be two main projects for adding child care and supportive services to the JOBS program and that funding the request would also fund state project staff to work with the contractors for design and implementation. Representative Martin recommended that those costs should be placed in the operating budget. Ms. Clarke advised that traditionally this type of project had been requested through the capital budget given that some of the enhancements are time limited. Representative Brown voiced hesitation in preceding with implementation of a program which will soon be obsolete given changes to the federal programs. Ms. Nash stated that the changes made to that system will help the State in making future welfare changes. If federal welfare reform is 4 passed, it will take a long time to implement. The new system will allow the State to function smoothly while those new systems are being developed. DEPARTMENT OF REVENUE ALASKA HOUSING FINANCE CORPORATION (AHFC) Ms. Slagle spoke to the Department's capital budget request for the Alaska Housing Finance Corporation (AHFC). DAN FANSKE, EXECUTIVE DIRECTION, ALASKA HOUSING FINANCE CORPORATION, DEPARTMENT OF REVENUE, ANCHORAGE, noted that with the proposed changes, the total capital budget request for the corporation would be $76.9 million dollars using corporate receipts of $54 million dollars and federal receipts of $22.367 million dollars. He pointed out that AHFC is a tremendous resource for the State of Alaska. With foresight and prudent management, it is uniquely qualified to provide a crucial service for the State for the rest of this decade. He concluded that the service could be defined as meeting the critical housing needs of all Alaskans. [Attachment #1]. Representative Martin provided Committee members with a handout addressing housing needs in the State and the responsibilities of AHFC. [Attachment #2]. He asked specifically about the Cedar Park allocation provided last year for $8 million dollars followed by the same request this year. Mr. Fanske noted that AHFC had been granted approval from Housing and Urban Development (HUD) to demolish and replace the fifty units of housing at Cedar Park. The project differs from the FY95 capital project, and that the final approved FY95 project was changed to the Riverbend Development project. Representative Martin questioned the authority AHFC had to change the project. RAY UTTER, BUDGET, ALASKA HOUSING FINANCE AUTHORITY CORPORATION, ANCHORAGE, pointed out that the funding changed from corporate funds to federal funds and that the Riverbend project had been included in a project description. He stressed that AHFC has the authority to change the name of the project prior to the passage of the bill. Ms. Slagle addressed the capital budget request for the housing and urban development comprehensive grant program in the amount of $4.326 million dollars. LES CAMPBELL, BUDGET, ALASKA HOUSING FINANCE CORPORATION, ANCHORAGE, explained that the request was included in last 5 year's budget request. The request combines three years of proposals, and noted that it had been a formula driven program. Ms. Slagle continued, the Cedar Park reconstruction request in the amount of $8.501 million dollars would cover replacement of those units. Representative Martin voiced his concern with the lack of legislative oversight. Mr. Fanske thought that the current process was providing the necessary and appropriate legislative scrutiny Representative Brown agreed. Ms. Slagle addressed the low income weatherization program request in the amount of $10.3 million dollars. She noted that $8.5 million dollars would be received from corporate receipts. Mr. Utter explained that the request would provide for long term affordability for existing homes. He commented on the standards currently used and noted that the request was $3 million dollars above last year's. Mr. Fanske responded to Representative Martin's concern regarding the ISER report. He explained that report was paid for and solicited by AHFC. Subsequent to that report, changes have been made to deal with some of the information that Institute of Social and Economic Reserach (ISER) pointed out. He pointed out that the report had used Anchorage to test out the energy efficiency of homes. Mr. Fanske added that Anchorage has the cheapest utilities for energy in the State and that would not be appropriate comparison. He provided the Committee with a memo from AHFC to Robert Brean, Director, Rural Housing Division addressing the effectiveness of the Weatherization Program. [Attachment #3]. (Tape Change, HFC 95-93, Side 2). Ms. Slagle continued, addressing the Department's capital budget request for the supplemental housing development program in the amount of $10.235 million dollars. Mr. Utter provided a breakdown of that request. Representative Martin questioned the changes that are occurring in the Housing and Urban Development (HUD) program on the federal level and the funding requested by the Department. Mr. Fanske remarked that a portion of the funding would provide for a needs assessment. Also, a portion of the funding would be used to address needs of seniors and disabled. The request would be recalibrated following the decision of the federal government. He agreed that it was possible that the federal decisions would affect the program, although, the program was designed to supply matching funds in order to capture federal dollars. He 6 noted that the request would affect mostly the rural communities. Representative Martin directed his concern's stating that the reports provided information which create an unrealistic situation in the housing conditions within the State. Mr. Fanske countered Representative Martin's concern pointing out that the reports create a realistic picture of the housing problems in Alaska. The program addresses housing needs in seventeen communities. Ms. Slagle continued, AHFC's capital budget request in the amount of $7.75 million dollars for the Golden Towers modernization would be used to help upgrade the five story senior housing center in Anchorage. Mr. Campbell noted that the building has maintenance problems and that the allocation would repair the building to a liveable state. Representative Kelly corrected Mr. Campbell, explaining that the Golden Towers was not a senior citizen facility but instead was a Section 8 facility. He stated that a problem existed when mixing seniors and those people who have disabilities. Mr. Fanske interjected that there has been funding provided for the immediate security needs of those that live in the facility. Ms. Slagle addressed AHFC's capital budget request for public housing environmental clean/abatement in the amount of $1 million dollars. The request would cover costs of removal and replacement of underground storage tanks in several communities. Mr. Campbell responded to Representative Martin's concern that the integrity of the tanks is marginal and that the tanks need replacing. He added that the tanks have been tested and some have already been replaced. Ms. Slagle stated that the following project would provide $500 thousand dollars for emergency repair and replacement in order to meet any emergency which may occur in the area of low income family housing projects. Ms. Slagle addressed AHFC's capital request in the amount of $250 thousand dollars for the emergency housing assistance program which would provide assistance in preventing homelessness. Mr. Campbell noted that this is an existing program which had been funded through the operating budget in the past. The program helps local communities to develop programs to prevent homelessness by providing assistance to families in danger of thus becoming homeless. Ms. Slagle continued, AHFC's capital budget request in the 7 amount of $1.75 million dollars for the senior and statewide deferred maintenance needs in order to deal with all those maintenance concerns of current existing housing projects. Mr. Fanske pointed out that the proposed program is already in existence. He noted that AHFC has generated tremendous profits thus making it a successful corporation. Representative Kohring agreed that AHFC has demonstrated sound fiscal management. He stressed that AHFC has not received general fund monies over the years, but instead has generated money as a result of excellent management. He urged Committee to acknowledge that effort. Ms. Slagle continued, AHFC's capital budget request in the amount of $4 million dollars for the senior citizens housing development program. Mr. Utter explained that the increment would provide senior housing to those persons 65 years of age or older. Representative Martin recommended adding an eligibility requirement to that program. Mr. Campbell noted that there are varying income level housing units being built. Ms. Slagle added, the next capital budget request in the amount of $3.75 million dollars would be used for the housing and urban development federal home grant for the Home Investment Partnership Program in order to provide low and moderate income housing. The increment would cover rehabilitation of the basic standard tenant housing assistance and acquisition for new construction of housing and nonprofit community housing development organizations. The majority of the request will come from the federal government. The next component for the multi-family, special needs, and congregate housing grants request in the amount of $2.5 million dollars would be used to provide money to private nonprofit corporations, municipalities and regional housing authorities to provide different types of housing needs within the communities. The request would target the very low income families. Mr. Campbell noted that the grants would be used as a last resort to make the projects viable. All other funding would be exhausted before tapping these funds. Ms. Slagle continued, AHFC's capital budget request in the amount of $2.1 million dollars to be used for the public housing energy performance contracting program for low income Alaskan's energy and specific needs. Mr. Utter advised that the allocations was tied to the low rent program. 8 Ms. Slagle addressed AHFC's capital budget request in the amount of $600 thousand dollars for the warm homes for Alaskans program. The request would include assistance to rural Alaskans in order to receive energy efficiency changes to their homes. The following component would provide $300 thousand dollars for the public housing support building construction for use of maintenance facilities which support housing projects. Mr. Campbell and Representative Mulder discussed the location of the site. They agreed that the most likely site would be in Anchorage's Muldoon area. Ms. Slagle addressed AHFC's capital budget request in the amount of $3.49 million dollars for federal competitive grants-public housing which would be used for special purpose grants associated with the housing programs and projects. She continued with AHFC's capital budget request in the amount of $6.5 million dollars for the federal competitive grants to be used for projects not related to public housing programs. (Tape Change, HFC 95-94, Side 1). Representative Martin asked who provided the match. Mr. Campbell noted that if a grant would require a match, most non-profits do not have the resources or capabilities to provide that match, consequently, AHFC would then provide it. Ms. Slagle continued, AHFC's capital budget request for the transition of the four star plus home incentive program in the amount of $2 million dollars which would provide incentive grants to purchase new homes in order to meet residential energy requirements. Mr. Campbell pointed out that this was an existing program and that State requirements mandates the four star rating. Ms. Slagle continued, the pre-development grant program capital budget request in the amount of $500 thousand dollars would be used to help with the expense of start-up costs in developing a special needs housing project. Mr. Campbell elaborated that AHFC does not provide all the housing in Alaska. The grant program would help those other groups to become started in housing projects. Ms. Slagle continued to describe AHFC's capital budget request for competitive grants in the amount of $325 thousand dollars. She pointed out that the allocation would be a private foundation grant from the Robert Wood Johnson 9 Foundation for a study on housing needs. The following line item request was the community service down-payment coupons capital budget request in the amount of $60 thousand dollars. Mr. Campbell commented that this was a new program which would allow participants in the public housing programs to earn a down payment for home purchasing by providing community service work. Ms. Slagle noted the health and social services special needs housing program request in the amount of $1.5 million dollars. She explained that the needs for housing for adults with special needs has risen and that the program would provide for a competitive grant program for non- profits in order to help develop special needs housing. Representative Martin understood that money had been added to the Department of Health and Social Services (DHSS) budget for that concern. Ms. Slagle advised that this increment would help take care of individuals by establishing housing facilities in communities which would allow them to go there from institutional care. The allocation would specifically create facilities for those individuals and would then tie into reductions included in the operating budget. Commissioner Perdue added that this would be a one time investment to relocate those individuals. Ms. Slagle continued with AHFC's capital budget request for the Pioneer Homes renovations and repairs in the amount of $326 thousand dollars. Currently, there exists $6.5 million dollars for needs within the Pioneer Homes for taking care of life, safety improvements, corrections of code violations and structural needs. The Governor thought that addressing the Pioneer Home needs would fit with the policy of AHFC. Representative Martin asked if the money requested had been denied by the Department of Administration's operating budget request. Ms. Slagle said that it did not, although, an appropriate place to fund it had not yet been established. Mr. Campbell advised that the request would only address the emergency improvements which need to be handled soon at the Pioneer Homes. Representative Kohring again voiced concern with the criticism focused toward AHFC. He emphasized that AHFC was the best run organization in the country. Ms. Slagle addressed AHFC's capital budget request for the stripper well oil overcharge restitution program in the amount of $2 million dollars. The following request would be for the energy conservation retrofit in the amount of 10 $500 thousand dollars which would be used specifically for low rent housing. She concluded that the last project request by AHFC would be $100 thousand dollars to be used for statewide research for field testing and monitoring of construction methods in order to eliminate premature degradation of the housing facilities. DEPARTMENT OF LAW Ms. Slagle addressed the Department of Law's capital budget request for the federal litigation/endangered species act in the amount of $665 thousand dollars. The request would address various cases between the State and federal jurisdiction concerning Alaska's natural resources. Representative Brown recommended that the request be placed in operating expenditures. Ms. Slagle noted that this type of request has typically been included in the capital budget since 1993 given that they are project specific. BARBARA RITCHIE, DEPUTY ATTORNEY GENERAL, CIVIL DIVISION, DEPARTMENT OF LAW, provided a extensive overview of the Department's request. Ms. Slagle concluded with the Department's capital budget request for computer replacement in the amount of $200 thousand dollars.
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