Legislature(1993 - 1994)

05/02/1994 01:45 PM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
  HOUSE BILL NO. 455                                                           
                                                                               
       "An Act  making  and  amending  operating  and  capital                 
       appropriations    and    ratifying     certain    state                 
       expenditures; and providing for an effective date."                     
                                                                               
  Co  Chair MacLean  observed that the  majority of  items are                 
  being    reappropriated    from    prior   year's    capital                 
  appropriations to other  projects.  She noted  that items in                 
  the bill adhere to the following guidelines:                                 
                                                                               
       *    1)   All  district  reappropriation  requests from                 
            individual legislators are "net zero".                             
                                                                               
       *    2) Only unexpended, unobligated general funds from                 
            capital  projects  identifiable   as  a   specific                 
            district project, and sponsored originally by  the                 
            legislature, are in the bill.                                      
                                                                               
       *    3)   No   reappropriation   items   requested   by                 
            individual legislators originally  appropriated as                 
            supplemental,  loan  funds  or  trust  funds  were                 
            included in the draft.                                             
                                                                               
       *    4) Each district's delegation has  submitted : (a)                 
            a  copy  of  the  original  appropriation   and/or                 
            amended language from which the reappropriation is                 
            being  made;   (b)  verification  of true  account                 
                                                                               
                                2                                              
                                                                               
                                                                               
            balances;    (c)  justification  and back-up  from                 
            local   government   and/or    appropriate   state                 
            agencies.                                                          
                                                                               
  Co-Chair MacLean provided members  with a sectional analysis                 
  of proposed reappropriations  (Attachment 1).   She reviewed                 
  the legislation by  section in order to  entertain questions                 
  from members.  There were no questions on sections 1 - 4.                    
                                                                               
  Representative Brown referenced  section 5.   She asked  the                 
  amount to be lapsed.  She questioned why funds are not being                 
  lapsed into the General Fund.                                                
                                                                               
  NANCY SLAGLE, DIRECTOR, DIVISION OF BUDGET REVIEW, OFFICE OF                 
  THE GOVERNOR emphasized that  funds have traditionally  been                 
  reappropriated  in   the   Office  of   the   Governor   and                 
  Legislature's budgets.                                                       
                                                                               
  Representative Brown  asked for clarification on  the lapsed                 
  funds in Section 6.                                                          
                                                                               
  Ms.  Slagle  stated  that $50.0  thousand  dollars  would be                 
  extended  in the  Division of  Budget Review, Office  of the                 
  Governor.                                                                    
                                                                               
  MIKE NIZICH, DIRECTOR, DIVISION OF ADMINISTRATIVE  SERVICES,                 
  OFFICE  OF THE  GOVERNOR,  addressed Representative  Brown's                 
  inquiry regarding extension of lapse  funds in sections five                 
  and six.   The estimated  lapse for section  five is  $900.0                 
  thousand dollars.  He emphasized that the  roll forward will                 
  provide funding for unexpected expenses in the Office of the                 
  Governor.                                                                    
                                                                               
  Co-Chair MacLean reviewed  sections 7  - 9.   There were  no                 
  questions.                                                                   
                                                                               
  Representative  Brown  asked  if  the  funds represented  in                 
  section 10 are part of the Exxon settlement money.  Co-Chair                 
  MacLean  agreed that  section  10 contains  Exxon settlement                 
  money.                                                                       
                                                                               
  Nancy   Slagle   noted  that   the  $50.0   thousand  dollar                 
  expenditure  does   not  required  trustee  approval.    She                 
  clarified that  section 10 was  submitted at the  request of                 
  Commissioner    Sandor,    Department    of    Environmental                 
  Conservation.                                                                
                                                                               
  Co-Chair MacLean noted that the grant to  the Prince William                 
  sound Aquaculture Corporation  will be used for  restoration                 
  and replacement  of natural  resources injured and  services                 
  lost  or  diminished as  a result  of  the Exxon  Valdez Oil                 
  Spill.  This will  be accomplished through the  operation of                 
                                                                               
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  hatcheries for the production of  common property salmon fry                 
  for Prince William Sound.                                                    
                                                                               
  Representative  Hanley  expressed concern  regarding section                 
  11,  expenditure of  federal funding  received for  services                 
  provided to Medicaid recipients.   He reminded the committee                 
  that  an  appropriation of  share  money was  placed  into a                 
  separate account last year  in this section.  He  noted that                 
  $20.0  million  dollars  were  going  to Alaska  Psychiatric                 
  Institute (API) and asked for clarification of costs.                        
                                                                               
  JANET CLARK, DIRECTOR,  DIVISION OF ADMINISTRATIVE SERVICES,                 
  DEPARTMENT OF  HEALTH AND  SOCIAL SERVICES  stated that  the                 
  department plans for  an initial  seventy two bed  facility.                 
  The department  has down scaled  the project to  provide the                 
  minimum  of  necessary  beds  in  the   first  phase.    The                 
  department  expects  an  additional  request  $8.0   million                 
  dollars next fiscal year.   The replacement of API  has been                 
  in  the planning stage for  approximately twelve years.  The                 
  department has  appropriated stop-gap  repairs  to keep  API                 
  going.  Last year the department was able to secure medicaid                 
  one  time  federal  funds  for   new  construction  of  API.                 
  Legislative  intent  was  added  in  FY  94,  requiring  the                 
  department  to return  to the  legislature to  appropriation                 
  authority.                                                                   
                                                                               
  Representative Brown asked if it was the department's intent                 
  to   start   construction  before   the  entire   amount  is                 
  appropriated for that purpose.                                               
                                                                               
  Ms. Clark reiterated that the original plan was scaled  down                 
  from a  114 to  a 72  bed facility.   The  first phase  will                 
  construct patient units, kitchen and laundry facilities.                     
                                                                               
  Co-Chair MacLean  announced that  section 11  would be  left                 
  open.                                                                        
                                                                               
  Representative  Martin  questioned  if   section  12  was  a                 
  deferred maintenance project.                                                
                                                                               
  Representative Grussendorf clarified that the Mt.  Edgecumbe                 
  High School gymnasium  was recently closed due  to asbestos.                 
  Lapsed money from the  dormitories would be used  to address                 
  the asbestos problem.                                                        
                                                                               
  There were no questions on Section 13 - 17.                                  
                                                                               
  There were no questions on Sections 24 - 32                                  
                                                                               
  Representative Larson clarified  that section  33 is at  the                 
  request of the Office of Budget and Management.                              
                                                                               
                                                                               
                                4                                              
                                                                               
                                                                               
  Nancy  Slagle,  at  the  request  of  Representative  Brown,                 
  explained  that  section 35  would  allow the  department to                 
  access funds that  had been used as a  lease deposit for the                 
  Tokyo Office  of International Trade.  The  funds would then                 
  be used to acquire less expensive lease space.                               
                                                                               
  Ms. Slagle clarified that an unallocated reduction was taken                 
  to  the Tokyo  office  in addition  to  the reductions  made                 
  during the  budget  process.   She  further noted  that  the                 
  transaction  outlined   in  section  35  would   enable  the                 
  department to keep the office open at a lower cost.                          
                                                                               
  VIRGINIA  STONKUS,  FISCAL   ANALYST,  LEGISLATIVE   FINANCE                 
  DIVISION explained  that the 1995 surcharge was not put into                 
  SB 215.  This language  would make the appropriation conform                 
  to  whatever  enabling  legislation goes  into  effect.   In                 
  response to a question by  Representative Brown, Ms. Stonkus                 
  clarified that sections  20 and 21  of the front section  of                 
  CSSB  370  (FIN) address  the  1994 surcharge  on  the spill                 
  reserve  balance,  depending  on  when  the bill  goes  into                 
  effect.  She reiterated that  section 37 addresses the  1995                 
  surcharge account to allow for the  split on the sixty forty                 
  percentage.                                                                  
                                                                               
  Ms. Stonkus clarified that SB 215  set up the procedures for                 
  accommodating the fund, but did not provide the mechanism to                 
  appropriately  allow for  the mechanics of  the transaction.                 
  She  further noted that sections  20 and 21 were recommended                 
  by the Division of Legal Services in order to conform to the                 
  bill.                                                                        
                                                                               
  Representative  Brown  asked  if  this  was  considered   an                 
  appropriation.                                                               
  Ms.  Stonkus  explained that  the FY  95 surcharge  would be                 
  considered a new appropriation.                                              
                                                                               
  Representative  Therriault   noted  that   funds  would   be                 
  allocated to  the new structure.   Instead of  two accounts,                 
  there   will  be  two   accounts  within  one   fund.    The                 
  appropriation can not  be contained in  SB 215, since it  is                 
  only enabling legislation.                                                   
                                                                               
  ARTHUR  SNOWDEN,  ADMINISTRATIVE   DIRECTOR,  ALASKA   COURT                 
  SYSTEM, explained that section 38 would  reappropriate funds                 
  for a new imaging system into computer hardware and software                 
  maintenance.                                                                 
                                                                               
  Representative Martin referred to section  39.  He asked  if                 
  statewide  funds  were being  reappropriated.    Ms. Stonkus                 
  confirmed that statewide funds are being reappropriated.                     
                                                                               
  REPRESENTATIVE BILL HUDSON  spoke in support of  section 39.                 
                                                                               
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  He noted that the Perseverance  Theater job training program                 
  offers  training  for  individuals  all  over the  state  of                 
  Alaska.                                                                      
                                                                               
  There were no questions regarding sections 40 - 43.                          
                                                                               
  NICO BUS, DEPARTMENT  OF NATURAL RESOURCES spoke  in regards                 
  to  section  44.   He  noted  that  funding  for the  Forest                 
  Practices Act effectiveness research project was included in                 
  the capital budget.  He stressed that the reappropriation is                 
  needed to be fully funded.                                                   
                                                                               
  There were no questions regarding sections 45 - 49.                          
                                                                               
  Representative Hanley discussed section  50.  He  maintained                 
  that the  Denali  southside visitor  center development  and                 
  Talkeetna water and sewer projects were statewide.                           
                                                                               
  Ms. Slaggle clarified that projects contained in sections 50                 
  and  51  were  identified  as   discretionary  funds.    She                 
  explained that some  water and  sewer projects in  Talkeetna                 
  were identified as part of the governor's village safe water                 
  projects.  These projects  were not included in sections  50                 
  and 51.                                                                      
                                                                               
  Representative Martin echoed concern that projects contained                 
  in sections 50 and 51 were not statewide projects.                           
  There were no questions in regards to sections 52 and 53.                    
                                                                               
  Ms. Slagle noted that section 54 was requested by the Office                 
  of Budget and Management.                                                    
                                                                               
  There were no questions in regards to section 55.                            
                                                                               
  (Tape Change, HFC 94-151, Side 2)                                            
                                                                               
  EDGAR BLATCHFORD, COMMISSIONER, DEPARTMENT  OF COMMUNITY AND                 
  REGIONAL AFFAIRS spoke in support of section 56.                             
                                                                               
  There were no questions in regards to sections 57 - 59.                      
                                                                               
  Co-Chair Larson discussed  reappropriation of carry forwards                 
  for  the  Legislature contained  in sections  45  - 48.   He                 
  itemized the carry forward amounts as detailed in  a summary                 
  by the Legislative Finance Division (Attachment 2).                          
                                                                               
  Representative  Navarre expressed  concern  with the  amount                 
  carried forward by the Senate.                                               
                                                                               
  Representative Therriault expressed concern with section 42.                 
  He questioned if funding being reappropriated from Fairbanks                 
  water and sewer projects was discretionary.                                  
                                                                               
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  Representative Hoffman expressed similar concerns in regards                 
  to section 44.                                                               
                                                                               
  Representative Brown noted that more than $8 million dollars                 
  would be carried  forward in the Legislature's  budget.  She                 
  maintained  that  the funds  should  lapse into  the General                 
  Fund.                                                                        
                                                                               
  Representative  Navarre  observed  that  the  Senate  FY  95                 
  operating budget is  in excess to the amount spent  in FY 94                 
  or FY 93.  He noted that the House FY 95 operating budget is                 
  below the  amount appropriated to  the House in FY  94 or FY                 
  93.                                                                          
                                                                               
  Co-Chair MacLean provided members with  AMENDMENT 1 (copy on                 
  file).   She  MOVED  to  AMEND Amendment  1,  delete  $320.0                 
  thousand dollars and  insert $150.0  thousand dollars.   She                 
  explained  that  the  amendment would  provide  funding  for                 
  Arctic Power  in the amount  of $250.0 thousand  dollars and                 
  provide   $150.0  thousand   dollars   for  radio   stations                 
  throughout the state.  Stations need state funding in  order                 
  to match federal grants  for equipment upgrades.  She  noted                 
  that the federal government will provide 3 dollars for every                 
  1 dollar of state  funding.  She  maintained that a lack  of                 
  state support  to the Alaska Public  Broadcasting Commission                 
  could endanger  the state's  ability to  get future  federal                 
  grants.  The  amendment would  only fund half  of the  state                 
  match requirement for each station.   She noted that funding                 
  for ANWR will remain in the governor's office.                               
  Representative Brown questioned  the $250.0 thousand  dollar                 
  grant to Arctic Power.  Representative Hanley explained that                 
  $3.0 million dollars was appropriated from the Office of the                 
  Governor for a national ANWR educational  effort.  A portion                 
  of this money  is being appropriated  to Arctic Power.   The                 
  amendment would also allocate a portion of this money to the                 
  radio stations.                                                              
                                                                               
  DIANE  KAPPLAN,  EXECUTIVE  DIRECTOR,  ALASKA  PUBLIC  RADIO                 
  NETWORK explained that the projects contained in amendment 1                 
  have been awarded or has pending  federal grants for which a                 
  local match is required.                                                     
                                                                               
  Representative Therriault  queried if  stations can  capture                 
  federal  funds with their existing state funds.  Ms. Kapplan                 
  observed that  permission would  be needed  from the  Alaska                 
  Public Broadcasting Commission in  order to divert operating                 
  support to capital support.                                                  
                                                                               
  There being NO OBJECTION, AMENDMENT 1 was amended.                           
                                                                               
  Representative Brown  recommended that the entire  amount be                 
                                                                               
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  returned to the Office of the  Governor for use in promoting                 
  ANWR.    She  MOVED  to AMEND  Amendment  1,  delete  $250.0                 
  thousand  dollars   to  Arctic  Power.     Co-Chair  MacLean                 
  OBJECTED.  A roll call vote was taken on the MOTION.                         
                                                                               
  IN FAVOR: Brown                                                              
  OPPOSED:  Grussendorf,  Hoffman,  Navarre,  Foster,  Hanley,                 
  Martin,        Parnell, Therriault, MacLean, Larson                          
                                                                               
  The MOTION FAILED (1-10).                                                    
                                                                               
  Co-Chair  MacLean  MOVED to  ADOPT  AMENDMENT 1  as amended.                 
  There being NO OBJECTION, it was so ordered.                                 
                                                                               
  DAVE  GRAY, STAFF,  REPRESENTATIVE  MACKIE provided  members                 
  with AMENDMENT  2 (copy  on file).   He  explained that  the                 
  amendment would  reappropriate $50.0  thousand dollars  from                 
  statewide  energy   and  power  project   development  to  a                 
  feasibility  study   of  an   electrical  intertie   between                 
  Petersburg and Kake.                                                         
                                                                               
  Representative  Navarre  wondered  why the  project  was not                 
  funded  through  the  statewide  energy  and  power  project                 
  development  appropriation.   Mr.  Gray  clarified that  the                 
  project was submitted for consideration.                                     
                                                                               
  Representative Hanley  noted that  grants are  awarded on  a                 
  competitive basis or according to ranking of priority.                       
                                                                               
  BRUCE GERAGHTY, DEPUTY COMMISSIONER, DEPARTMENT OF COMMUNITY                 
  AND  REGIONAL  AFFAIRS  explained  that  there  is  $365,288                 
  thousand dollars  remaining in the  fund.  He  observed that                 
  the  Petersburg/Kake  intertie  project  is  on  a  list  of                 
  projects  to  be  considered.    He did  not  recommend  the                 
  reappropriation.                                                             
                                                                               
  Representative  Navarre MOVED to ADOPT  AMENDMENT 2.  A roll                 
  call vote  was taken on  the MOTION.   Representative Hanley                 
  OBJECTED.                                                                    
                                                                               
  IN FAVOR: Brown, Grussendorf, Navarre                                        
  OPPOSED:  Foster, Hanley, Martin, Parnell, Therriault, MacLe                 
  an, Larson                                                                   
                                                                               
  Representative Hoffman was not present for the vote.                         
                                                                               
  The MOTION FAILED (3-7).                                                     
                                                                               
  Co-Chair MacLean provided members with  AMENDMENT 3 (copy on                 
  file).  She explained that the amendment would reappropriate                 
  $500.0 thousand dollars to the Alaska Marine Highway System.                 
                                                                               
                                                                               
                                8                                              
                                                                               
                                                                               
  REPRESENTATIVE  BILL   HUDSON  observed  that  there  is  an                 
  appropriation of $4.0 million dollars  in the capital budget                 
  for  the  Alaska Marine  Highway  maintenance overhaul.   He                 
  asserted that $4.0  million dollars is insufficient  to keep                 
  the  vessels  running.    He  noted  there  have  been  past                 
  reductions  to appropriations for deferred maintenance.  The                 
  amendment would reappropriate  $500.0 thousand dollars  from                 
  the  Highway   System  Administration  building   to  vessel                 
  maintenance and overhaul.                                                    
                                                                               
  Representative Navarre MOVED  to ADOPT  AMENDMENT 3.   There                 
  being NO OBJECTION, it was so ordered.                                       
                                                                               
  REPRESENTATIVE CARL MOSES provided members  with AMENDMENT 4                 
  (copy  on   file).     He  explained   that  the   amendment                 
  reappropriates  $2.3  million  dollars  from  the Pedro  Bay                 
  School project  to other district  projects.  The  Pedro Bay                 
  School project was vetoed by the Governor.                                   
                                                                               
  Co-Chair Maclean MOVED  to ADOPT AMENDMENT  4.  A roll  call                 
  vote was taken on the MOTION.                                                
                                                                               
  IN FAVOR: Grussendorf,  Hoffman,  Foster,  Martin,  Parnell,                 
  MacLean, Larson                                                              
  OPPOSED:  Brown, Navarre, Hanley, Therriault                                 
                                                                               
  The MOTION PASSED (7-4).                                                     
                                                                               
  Representative Moses provided members with AMENDMENT 5 (copy                 
  on file).   Amendment 5  would expand the  title.   Co-Chair                 
  MacLean  MOVED  to  ADOPT  AMENDMENT  5.    There  being  NO                 
  OBJECTION, it was so ordered.                                                
                                                                               
  REPRESENTATIVE   IRENE   NICHOLIA   provided  members   with                 
  AMENDMENT 6 (copy on file).   She explained that the request                 
  would  reappropriate the  balance of  the  Regional Boarding                 
  School Feasibility Study to the Galena School District.  The                 
  funds would be used for planning  and analysis of a regional                 
  boarding school.   She noted  that when the  U.S. Air  Force                 
  downsized  in  Galena  several building  were  left  vacant.                 
  These buildings could be  used to house a regional  boarding                 
  high school.                                                                 
                                                                               
  (Tape Change, HFC 94-152, Side 1)                                            
                                                                               
  Representative Therriault  OBJECTED.   He expressed  concern                 
  that the Department of Education study be completed prior to                 
  the  reappropriation.   Co-Chair MacLean clarified  that the                 
  Department of Education  does not  object to the  amendment.                 
  Representative  Therriault WITHDREW  his  OBJECTION.   There                 
  being NO OBJECTION, AMENDMENT 6 was adopted.                                 
                                                                               
                                                                               
                                9                                              
                                                                               
                                                                               
  AMENDMENT 7 was WITHDRAWN.                                                   
                                                                               
  Representative Grussendorf provided members with AMENDMENT 8                 
  (copy on  file).   He explained  that the City  of Sitka  is                 
  requesting forgiveness  of the  remaining interest  on their                 
  Alaska  Power  Authority state  loan.    He noted  that  $12                 
  million dollars remains on the loan.  The  city of Sitka has                 
  paid  $3 million  dollars  on the  principle and  $6 million                 
  dollars  in  interest.    Discussion  pursued regarding  the                 
  amortization of the loan.  AMENDMENT 8 was HELD.                             
                                                                               
  Representative Brown provided members with AMENDMENT 9 (copy                 
  on file).   She explained  that amendment 9  would repeal  a                 
  project  appropriated  in  1992.   She  maintained  that the                 
  redesign of Fireweed  Lane, Anchorage  was not supported  by                 
  the  community.   She  observed  that the  Spenard Community                 
  Council has requested the repeal.                                            
                                                                               
  Representative Brown MOVED  to ADOPT AMENDMENT 9.   Co-Chair                 
  MacLean  clarified  that  the  amendment  addresses  federal                 
  authority.    Funds  have  not  been  appropriated  for  the                 
  project.  There being NO OBJECTION, it was so ordered.                       
                                                                               
  AMENDMENT 10 was HELD.                                                       
                                                                               
  Ms. Slagle pointed  out that in  AMENDMENT 4, section 2  the                 
  appropriation source "Educational Facilities Maintenance and                 
  Construction Fund" should have been the "General Fund".                      
                                                                               
  Co-Chair  MacLean  MOVED to  AMEND  Amendment 4  by deleting                 
  "Educational Facilities Maintenance  and Construction  Fund"                 
  and inserting  "General Fund".  There being NO OBJECTION, it                 
  was so ordered.                                                              
                                                                               
  Co-Chair  Larson  MOVED  to  close  all  sections  with  the                 
  exception of  sections 8,  10, 11, 42,  45, 46,  47 and  48.                 
  There being NO OBJECTION, it was so ordered.                                 
                                                                               
  HB 455 was HELD in Committee for further discussion.                         

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