Legislature(2001 - 2002)
04/25/2001 01:48 PM House FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE BILL NO. 108 "An Act relating to the accounting for and appropriation of fees for recording and related services by the Department of Natural Resources; and providing for an effective date." NICO BUS, ADMINISTRATIVE SERVICES MANAGER, DIVISION OF SUPPORT SERVICES, DEPARTMENT OF NATURAL RESOURCES testified in support of the legislation. The legislation would change the funding source for the state recorder's operations from program receipts to receipts supported services. He observed that HB 418 provided authorization for use of customer receipts to support their programs. He emphasized the difficulty of the Recorder's Office to compete with other programs within the Department of Natural Resources. The Recorder's Office generates approximately $4 million dollars in receipts. The operating costs for the Recorder's Office is approximately $2.4 million dollars. Vice-Chair Bunde questioned if customers are being charged too much if revenues generate more than the cost of operations. He added that the legislation would take the legislation out of the appropriation process. Mr. Bus responded that the change would retain the requirement for annual legislative authorization. He clarified that recording is one responsibility of the office and archiving is another. There are many records that have not been archived. Storage adds to the costs. Municipalities that have stored records over the years are returning books that must be stored to the state of Alaska. He noted that the alternative is to close offices. Representative Hudson noted that there are records dating back to the 1800's. He spoke in support of placing the program under receipts supported services. In response to a question by Representative Lancaster, Mr. Bus explained that the Palmer Office is moving from a 15- year lease. The increase in population over the past 15 years has resulted in an overcrowded facility. The lease cost was only .70 cents, since it was negotiated 15 years ago. They now have to pay current market value. The office requires more square footage at increased cost. In addition, the office has inherited equipment from the Alaska Court System that has no maintenance agreements. All documents presented to the recorder's office must be returned via mail to the customer. Postal fee increases have added to increased cost. Representative Harris noted that there are three offices operated by the Alaska Court System: Seward, Valdez and Glennallen. Court activities receive priority in these offices. Mr. Bus stressed the need to identify personnel to fulfill this function. The Department of Natural Resources operates the other 11 offices. In response to a question by Representative Harris, Mr. Bus clarified that since the implementation of the State's Recorder's Office Index System they have provided a daily on-line transfer index without missing a day. Vice-Chair Bunde maintained that funding for the Recorder's Office should be considered with all other expenditures. Mr. Bus responded that detailed expenditures are submitted to the legislature. Funds are not dedicated and must receive legislative authorization. The purpose is to present their true needs within the competition of the entire department. Co-Chair Mulder pointed out that there is a lot of activity in the Nome office, yet it was the first office cut. Representative John Davies noted that the fundamental policy question is should they be in the category of receipts supported services. He acknowledged that the service generates a lot of fees and the customers are frustrated because the service cannot be advanced in appropriate ways. The legislation would take away the artificial cap issue and allow decisions to be based on the proper level of service. Vice-Chair Bunde maintained that the budget for the Recorder's Office would be increased from $2.4 to $4 million dollars by the passage of the bill. Representative John Davies argued that subcommittees would still review the funding, but that the arbitrary cap would be removed. Representative Hudson stressed that the change would allow better bookkeeping. Services would be tied to revenues. He pointed out that [under the current system] general fund expenditures are reduced to an agency that is earning its own keep. Representative Whitaker observed that the revenues would be used to provide better service where they are earned. The legislation would provide a structural change, by dedicating them to the department where they are produced. He pointed out that the same argument could be made in the Division of Oil and Gas and expressed concern that the dedication may not be in the best interest [of the Legislature]. Mr. Bus argued that workload is directly related to the customer's action. Representative Harris spoke in support of the legislation. He noted the number of complaints from the public sector regarding the level of service. The Legislature would still have to approve the funds, but it would not be counted against the general fund component. He maintained that accountability would continue through the budgeting process. Representative John Davies argued that the legislation does not create a dedicated fund. He felt that it is more of an issue of fund source: a different type of program receipt. It would be a sub account in the General Fund and expenditures would not be automatic. Representative Whitaker asked if there is a current document backlog. Mr. Bus noted that the statutes require 24 hour indexing. The problem occurs after the indexing. There is a backlog in archiving. There are rooms full of information that is not available to the public because it must be filmed and digitized. He discussed means to reduce the backlog. Representative Whitaker summarized that there is a backlog of work that could be solved with an allocation of funds. Mr. Bus observed that capital project funding has been requested for the past several years. The funds have not been sufficient to keep up with the level of work. Capital requests have been funded. If the legislation were passed the level of funding would remain at $2.5 million dollars unless the court offices were included. The Recorders' Office has requested additional operational funding, which has not always been received. Co-Chair Mulder summarized that the issue differs from past functions because it makes more money than the cost of operations. He expressed confidence that the subcommittee chair would watch expenditures and added sympathy for user groups that want a timely product for their fee. Vice-Chair Bunde maintained that the department would still request additional funds. He argued against passage of the legislation. Representative Foster MOVED to report HB 108 out of Committee with the accompanying fiscal note. Vice-Chair Bunde OBJECTED. A roll call vote was taken on the motion to Move HB 108 from Committee. IN FAVOR: Davies, Foster, Harris, Hudson, Lancaster, Whitaker, Croft, Williams, Mulder OPPOSED: Bunde Representative Moses was absent from the vote. The MOTION PASSED (9-1). HB 108 was REPORTED out of Committee with a "do pass" recommendation and with a previously published fiscal impact note (#1) by the Department of Natural Resources.
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